In a significant development, Ripple Labs’ chief legal officer, Stuart Alderoty, stated that Ripple’s recent victory over the U.S. Securities and Exchange Commission (SEC) could set the stage for other pending crypto litigations.
This comes after Ripple triumphed in a landmark court case in mid-July, successfully rebuffing the SEC’s charges of unauthorized securities offerings involving XRP. Consequently, Alderoty expressed his insights on TechCrunch’s Chain Reaction podcast, dissecting this judgment’s potential ripple effects on the SEC’s ongoing actions against Binance and Coinbase.
“According to our instance, ‘there is no security because the exchange of digital tokens does not constitute a contract for an investment’,” said Alderoty. This statement bodes well for both Coinbase and Binance.
The pivotal takeaway from the Ripple judgment, Alderoty emphasized, is the interaction between sellers and buyers. He argued that attempts by the SEC to frame assets as securities may fall flat, diminishing the agency’s authority over stock market transactions.
Besides, Alderoty cautioned the SEC about asserting things as securities when they do not qualify. “They’re no longer relevant to the discussion and should thus withdraw from it,” he asserted.
However, the Ripple Labs legal chief also conceded the SEC may still need to completely drop its ambition to regulate the crypto market through enforcement. He anticipates further SEC action connected to institutional sales of XRP but argues this would not relate to its status as a security.
Significantly, the possibility of SEC appeal that could further amplify Ripple’s win was also discussed. Alderoty also deliberated upon the potential for exchanges to uphold compliance and protect cryptocurrency investors through alternative strategies. He expressed guarded optimism about the verdict, advocating for other methods exchanges could use to ensure compliance and safeguard crypto investors.
Moreover, Alderoty’s commentary underscores the relevance and potential impact of the Ripple ruling on other similar litigation. Hence, the crypto world watches with bated breath, as this could be a defining moment in the ongoing tussle between cryptocurrencies and regulatory bodies. The legal precedent set by Ripple’s victory may prove influential in shaping the regulatory landscape of the cryptocurrency world.
