Ripple (XRP) and the US Securities and Exchange Commission (SEC) have been in a legal battle since December 2020. The first round went to Ripple, the second round is now beginning. Both parties have filed a joint motion.
The success of Bitcoin ETFs continues to create a positive mood in the crypto scene, and some investors may be suppressing potential difficulties. On the one hand, there are recent reports that the US Securities and Exchange Commission (SEC) is preparing legal action against Ethereum (ETH). And then there is the SEC’s battle against Ripple (XRP), which has been going on for more than three years and has long been regarded as exemplary for the authority’s position.
In SEC vs. Ripple, the first ruling in the summer of 2023 was in favor of XRP. The court did not follow the SEC in its demand to classify XRP as a security. Ripple and the crypto industry celebrated this as a success because the SEC suffered a setback in arguing similarly against other altcoins. But the court also scheduled a second trial to clarify the status of XRP in sales to institutional investors.
That trial is now picking up steam, and watching attorney James Filan is keeping up via X. The SEC and Ripple have jointly requested that documents filed now be treated confidentially for the time being and only later be made public in a restricted manner. The two parties to the proceedings promise to maintain a balance between public interest and confidentiality obligations. Ripple may want to protect business partners, for example, while the SEC may not want to be seen to be holding its cards close to its chest when it comes to internal decision-making.
It is now also clear that the deadlines for the SEC and Ripple to submit motions, evidence and responses will begin tomorrow (March 22). According to the current schedule, several stages are planned up to May 20. If the trial does not take a surprising turn, a verdict is likely to be reached in the summer. Neither the SEC nor Ripple have so far indicated any willingness to consider an out-of-court settlement.
Conclusion: SEC v. Ripple and XRP will once again point the way forward
In the US, the SEC is making it clear these days that it has no intention of taking a generally friendlier approach to the crypto industry following the approval of Bitcoin ETFs. Ripple and XRP have already had plenty of experience with the SEC’s headwinds – but have so far been rewarded for fighting out the dispute legally. It remains to be seen what will emerge from the SEC against Ripple over the next two months.
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