Prices for XRP rose by 7.4% on June 13 as traders bet on a favorable outcome for Ripple Labs in its ongoing legal battle with the U.S. Securities and Exchange Commission (SEC). William Hinman, a former SEC employee, had information released about the coin, which caused the price to rise faster than the general crypto market. The XRP’s legal position may be clarified by the release of these documents, according to Brad Garlinghouse, CEO of Ripple.
Ripple vs SEC: XRP price rises amidst bet on successful resolution
Reports from reputable media houses state that, as traders presumably bet on a successful resolution for payments provider Ripple Labs in its current Ripple vs SEC litigation, XRP prices increased 7.4% over the last 24 hours to outperform nominal gains in the larger cryptocurrency market.
These gains happened due to the public release of records related to William Hinman, the former director of the Division of Corporation Finance of the U.S. Securities and Exchange Commission (SEC) from 2017 to 2020.
The SEC filed a lawsuit against Ripple in 2020 over claims that the company marketed unregistered securities. Since its inception, Ripple has kept a boundary between the XRP Ledger network and the coin that drives some of its products, or XRP. However, the case’s status affects XRP price movements.
Ripple’s legal battle and Hinman documents
Brad Garlinghouse suggested that Ripple’s legal fight would turn on the much anticipated Hinman documents describing internal discussions by Securities and Exchange Commission officials. Ripple CEO assures Hinman documents will be worth waiting for as release nears.
Although he did not want to “overstep,” Garlinghouse tweeted on June 12 that he and Ripple’s chief legal officer Stuart Alderoty believed the records were worth the 18-month battle to be unsealed. Garlinghouse was responding to a query posed by cryptocurrency YouTuber Jungle Inc.
In the Hinman papers, internal SEC messages are discussed about a speech William Hinman, a former Securities and Exchange Director, gave in 2018. Hinman noted that digital currencies like Bitcoin include Ethereum in his remarks. Although they may begin as securities, they could eventually decentralize to the point where they resemble commodities.
Many supporters of Ripple think that the upcoming unsealing of the documents will be crucial in revealing further information about the legal standing of Ripple’s native currency.
Following a flurry of legal actions against the exchange, the federal court will hear the SEC’s demand to freeze the assets of Binance.US on June 13. In December 2020, the SEC filed a lawsuit against Ripple, claiming that selling its native XRP crypto constituted an unregistered securities offering. Since then, Ripple has refuted claims that XRP is a security because it does not pass the Howey test.
Pro-XRP lawyer John Deaton recently asserted that the presiding Judge Analisa Torres would likely render a judgment by September 30 this year, even though several top Ripple executives have long predicted that the rollercoaster lawsuit from the SEC would soon end.
XRP price gains were erased after the Hinman document’s release
According to on-chain data, the price of XRP lost its gains and fell to $0.5301 on Binance following a 6% surge on June 13. Holders of XRP should prepare for increased volatility as pertinent paperwork and communications are gathered and posted online.
The Hinman records allude to internal SEC correspondence involving a speech delivered in 2018 by William Hinman, a former director of the Corporation Finance division. These materials’ contents further detail the SEC’s position on cryptocurrencies like Ethereum.
In 2020, the SEC filed a lawsuit against Ripple, claiming the company had marketed unregistered securities. According to the documents released on June 13, the SEC views “token lockup” and subsequent releases as a symptom of a non-security, indicating that Ripple’s planned token unlocks for XRP shouldn’t be regarded as a security.
An attorney and XRP supporter named Bill Morgan recently tweeted about the SEC’s evolving position on approaching digital assets while also sharing the redacted portions of earlier filings.
According to Stuart Alderoty, Chief Legal Officer of Ripple, the former SEC Director of Corporation Finance’s 2018 talk was unconnected to the Howey factors and exposed regulatory inadequacies. He asserted that the materials “create greater confusion” rather than dispelling the SEC’s allegations against Ripple.
