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Ripple’s Chief Legal Officer, Stuart Alderoty, criticized the SEC’s appeal, calling it an extension of the agency’s “litigation warfare”.
Key Notes
The SEC appeal in Ripple lawsuit caused XRP's price to drop by nearly 11% losing crucial support of $0.60.Ripple is considering filing a cross-appeal in response with Brad Garlinghouse stating that they are willing to fight as long as needed.He stressed that XRP's status as a non-security remains the law despite the ongoing legal battle.On Wednesday, October 2, the US Securities and Exchange Commission (SEC) filed a “notice of appeal” with the Second Circuit Court of Appeals, just ahead of the October 7 deadline. This appeal was very much on the expected lines, however, it led to the XRP XRP $0.52 24h volatility: 13.0% Market cap: $29.63 B Vol. 24h: $2.79 B price crashing nearly 11% moving all the way to $0.5375 levels.
Back in July 2023, Judge Analisa Torres announced a landmark decision with $125 million in penalty settlement, from Ripple to the SEC. The judge announced that Ripple had violated the federal securities law through the institutional sales of XRP. However, this was significantly lower than the $2 billion penalty that the securities regulator was claiming.
Speaking on yesterday’s development, the SEC spokesperson said:
“We believe that the district court decision in the Ripple matter conflicts with decades of Supreme Court precedent and securities laws and look forward to making our case to the Second Circuit.”
However, there are some anomalies associated with the SEC’s recent appeal in the Ripple lawsuit. Fox Business journalist Eleanor Terret stated that the “notice of appeal” by the US SEC mentions August 7, considering it as the day of the ‘final judgment’. However, the regulatory agency has not yet specified which aspects of the case it intends to challenge.
The appeal could target either the court’s ruling on programmatic sales from July 2023, the amount Ripple was ordered to pay for institutional sales as of August 7, or both. Further details on the SEC’s specific appeal points are expected to emerge soon.
Ripple Prepares for a Cross-Appeal against the SEC
Following yesterday’s development, Ripple Chief Legal Officer Stuart Alderoty voiced his frustration and said that the blockchain might think of a cross-appeal. “The SEC’s decision to appeal is disappointing, but not surprising,” Alderoty stated.
He further added that the SEC appeal is an extension of a “complete embarrassment” for the agency. Furthermore, he highlighted that the court had rejected the SEC’s claims that Ripple acted recklessly, emphasizing the absence of fraud, victims, or financial losses.
Alderoty also blamed the securities regulator for engaging in “litigation warfare” under the leadership of Gary Gensler. “Either way, the SEC’s lawsuit has been irrational and misguided from the start, and we’re ready to prove that yet again in the appellate court,” Alderoty added.
Ripple CEO Brad Garlinghouse also weighed in on the decision adding: “If Gensler and the SEC were rational, they would have moved on from this case long ago”. Garlinghouse stated that the SEC’s decision hasn’t protected investors, but rather damaged the credibility and reputation of the agency.
He also showed the company’s willingness to fight the case further. “While we’ll fight in court for as long as we need, let’s be clear: XRP’s status as a non-security is the law of the land today – and that does not change even in the face of this misguided – and infuriating – appeal,” wrote Garlinghouse.
After some strength last week, the XRP price has once again lost the crucial support of $0.60. Additionally, broader market selloff and altcoin crash have added to the selling pressure.
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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
