Ripple Gears Up for Legal Battle After SEC Challenges XRP Ruling

Ripple is preparing for another round in its ongoing legal struggle with the U.S. Securities and Exchange Commission (SEC). The SEC officially filed an appeal on October 2, disputing a federal judge’s earlier ruling in Ripple’s favor, which has reignited a legal fight that has lasted nearly four years.

The SEC’s Appeal

The SEC’s appeal challenges Judge Analisa Torres’ decision from July 2023, which created a split verdict. In her ruling, Judge Torres found that Ripple had violated securities laws when selling XRP to institutional investors. However, she also determined that Ripple’s sales to retail investors on public exchanges did not breach these regulations. This mixed ruling was seen as a partial victory for Ripple and a significant moment for the broader cryptocurrency industry.

In its appeal, the SEC argues that the decision goes against long-established securities laws and Supreme Court precedents. An SEC spokesperson said, “We believe the district court decision conflicts with decades of Supreme Court precedent and securities laws. We look forward to making our case to the Second Circuit.”

Ripple’s Response

Ripple isn’t backing down. CEO Brad Garlinghouse made it clear the company is prepared to fight for as long as it takes. He tweeted, “Somehow, they still haven’t gotten the message: they lost on everything that matters. Ripple, the crypto industry, and the rule of law have already prevailed.” Garlinghouse emphasized that XRP’s status as a non-security remains intact, despite the SEC’s appeal.

Stuart Alderoty, Ripple’s Chief Legal Officer, also expressed disappointment but wasn’t surprised by the SEC’s move. He hinted that Ripple might launch a cross-appeal in response.

Impact on XRP Prices

The news of the SEC’s appeal had an immediate impact on XRP’s price. The cryptocurrency dropped by over 8% within 24 hours of the announcement, falling to around $0.52. This reaction shows the market’s sensitivity to the ongoing legal battles surrounding Ripple and its XRP token.

What Experts Are Saying

Lawyer Jeremy Hogan, a partner at Hogan & Hogan, believes the SEC’s decision to appeal is a mistake. He explained that even if the SEC wins the appeal, it would likely only result in Ripple paying more money. “Nothing would change as to XRP and its use by Ripple,” Hogan said. He also noted that a final ruling from the Appellate Court isn’t expected until late 2025 or early 2026.

Ripple’s Future

Despite the legal uncertainty, Ripple continues to expand its business. On September 30, Bitwise, an investment firm, began the process of launching an exchange-traded fund (ETF) for XRP. They formally submitted their request to the SEC on October 2, marking a significant step in potentially offering an XRP ETF to U.S. investors.

Ripple’s legal fight with the SEC is far from over, but the company is determined to keep moving forward, both in court and in business.

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Disclaimer: This article is for informational purposes only and does not constitute financial advice. The views expressed are those of the author and not necessarily those of CryptoInsider. Readers are encouraged to conduct their own research before making any financial decisions.