- The US Securities and Exchange Commission (SEC) is planning to appeal a federal judge’s decision regarding the classification of Ripple Labs Inc.’s XRP token.
- Chamberlain, in a post about the trial, predicts that US District Judge Analisa Torres will reject the SEC’s appeal request.
- Judge Torres’ original decision acknowledged that the sales of XRP to sophisticated investors were considered investment contracts.
The US Securities and Exchange Commission has filed a petition to appeal the recent Ripple (XRP) decision by the court.
SEC Files Petition to Appeal XRP Decision
Following the announcement by the US Securities and Exchange Commission (SEC) that it plans to appeal a federal judge’s decision on the classification of Ripple Labs Inc.’s XRP token, a wave of analysis and discussion has emerged in the crypto community. This move has sparked debates about the intricacies of XRP transactions and the impact of securities laws on the crypto market. At the center of the debate is a post by Scott Chamberlain, a prominent former lawyer and a vocal supporter of XRP.
In his post, Chamberlain expresses his opinion about the trial and predicts that US District Judge Analisa Torres will reject the SEC’s appeal request. Chamberlain states that Judge Torres relied on well-established concepts such as the well-known Howey test and its interpretations, rather than adding new legal frameworks, and therefore avoided new legal frameworks. Chamberlain wrote, “My prediction: Judge Torres will reject the request. She avoided new law.”
Chamberlain’s analysis emerged in response to attorney James K. Filan’s announcement of the SEC’s appeal application. Filan tweeted, “SEC has published a letter explaining the basis for filing an appeal regarding programmatic offers, sales through trading platforms to XRP buyers, and Ripple’s ‘Other Distributions’.”
Chamberlain also emphasizes that Judge Torres’ decision was based on the presentation of the SEC’s transaction “buckets” and their application after the Howey test. He argues that two or three transaction buckets do not meet the requirements of the Howey test and that the reinterpretation of alleged legal standards did not cause the negative outcome.
Jeremy Hogan also tweeted that he does not believe Ripple and other founders will be delisted as long as they can obtain XRP from the secondary market because they are only allowed to sell XRP as investment contracts.
Judge Torres’ Decision on XRP
Judge Torres’ original decision acknowledged that the sales of XRP to sophisticated investors were considered investment contracts. However, it excluded program participants representing the general public who engage in XRP trading on exchanges from this classification. According to Bloomberg, the second group was excluded from this classification because it did not share the same understanding of speculative value propositions and potential profits.
The SEC’s decision to appeal Judge Torres’ ruling reflects its commitment to clarifying the regulatory status of cryptocurrencies like XRP. The upcoming appeal could significantly impact the legal framework for digital assets and serve as a precedent for similar token classification cases. Amidst this confusion, the price of XRP is currently at $0.6264, showing a decrease of over 2%.
