- The important decision in the high-stakes legal battle between Ripple and the SEC has set an example for the regulation of cryptocurrencies in the US.
- According to a recent report, the SEC has expressed its dissatisfaction with certain parts of the decision and indicated that it is considering reviewing them.
- Since the decision, XRP’s chances have increased. The token has become the fourth largest cryptocurrency in terms of market value, increasing by 55% since the announcement of the decision.
SEC – Judge Torres’ decision in the Ripple case has brought hope for XRP and the crypto world, but the SEC does not seem satisfied with this situation; the fight against XRP may continue.
SEC is Not Satisfied with the Court’s Decision
The important decision in the high-stakes legal battle between Ripple and the US Securities and Exchange Commission (SEC) has set an example for the regulation of cryptocurrencies in the US. However, the war does not seem to be over yet; according to a recent report, the SEC has expressed its dissatisfaction with certain parts of the decision and indicated that it is considering reviewing them.
Ripple-supporting lawyer John E Deaton stated that even if the SEC were to file a second appeal, XRP would not be under any threat in the near future. Deaton said that even if the appeal were to be made now, it would take at least two years for a decision to be made by a second-level court. During this period, Judge Analisa Torres’ decision will be legally binding for all stakeholders.
The lawyer continued to highlight another interesting scenario. According to Deaton, even if a judge in a higher court points out flaws in Torres’ application of the third criterion of the Howey Test, this would not guarantee a victory for the SEC.
In such a case, Judge Torres, according to Deaton, could evaluate the case with the other two criteria, which are more difficult to satisfy.
The Focus of the Debate: The Howey Test
The Howey Test is a legal test used to determine whether a transaction can be considered a security. According to the test, if a transaction is considered a security, it must involve an investment of money in a common enterprise with an expectation of profits derived from the efforts of others.
The recent decision determined that the general public sale of XRP would not be considered a security because individual buyers could not know Ripple’s intentions and therefore could not meet the third factor of the Howey Test.
However, this part of the decision has become a controversial issue. Former SEC official John Reed Stark rejected this assumption, calling it “not only protective but also mocking.”
Since the decision, XRP’s chances have increased. The token has become the fourth largest cryptocurrency in terms of market value, increasing by 50% since the announcement of the decision. XRP is currently trading at $0.69.
