The Securities and Exchange Commission (SEC) is planning
to move to court to challenge the ruling that granted Ripple Labs a partial win
against the agency. The SEC has reportedly written to a judge in Manhattan to
allow the federal court of appeal to examine the ruling, which was made in July.
On July 13, US District
Judge Analisa Torres ruled that the sale of Ripple’s cryptocurrency XRP on
public exchange did not amount to a violation of the securities regulations.
The decision was against SEC’s argument that the blockchain payments platform
sold unregistered securities to the public.
In her ruling, Torres explained that Ripple did not violate the
securities law because the purchasers of XRP did not expect to make a
profit based on Ripple ’s efforts. However, the judge said that Ripple could
have violated the law by offering the cryptocurrency to institutional
investors. The judge must decide whether to allow the appeal case to continue
and put the case on hold.
According to a report by
Reuters, the SEC said in the letter that the appeal would address what it described as a substantial ground for differences of opinion. The
ruling came as a setback for the SEC, which has for a long time termed
cryptocurrencies as securities, similar to stocks and bonds, which must be brought under its purview.
Change of Stance?
However, in a separate
report by CNBC, a judge in the same federal court that handed Ripple the
partial victory, issued a contravening opinion that cryptocurrencies are
considered securities regardless of the context in which they are sold. The
opinion by Judge Jed Rakoff gave the SEC the green light to pursue its lawsuit
against Terraform
Labs and its Founder Do Kwon.
However,
the opinion reportedly complicates the legal tussle between the agency and
Ripple, and several other pending cases pitting the SEC and crypto companies. In
June, the regulator sued Coinbase for allegedly issuing unregistered securities
and operating an illegal trading platform. However, the exchange has disputed
the claims, saying the
regulator has no jurisdiction over cryptocurrencies.
The Securities and Exchange Commission (SEC) is planning
to move to court to challenge the ruling that granted Ripple Labs a partial win
against the agency. The SEC has reportedly written to a judge in Manhattan to
allow the federal court of appeal to examine the ruling, which was made in July.
On July 13, US District
Judge Analisa Torres ruled that the sale of Ripple’s cryptocurrency XRP on
public exchange did not amount to a violation of the securities regulations.
The decision was against SEC’s argument that the blockchain payments platform
sold unregistered securities to the public.
In her ruling, Torres explained that Ripple did not violate the
securities law because the purchasers of XRP did not expect to make a
profit based on Ripple ’s efforts. However, the judge said that Ripple could
have violated the law by offering the cryptocurrency to institutional
investors. The judge must decide whether to allow the appeal case to continue
and put the case on hold.
According to a report by
Reuters, the SEC said in the letter that the appeal would address what it described as a substantial ground for differences of opinion. The
ruling came as a setback for the SEC, which has for a long time termed
cryptocurrencies as securities, similar to stocks and bonds, which must be brought under its purview.
Change of Stance?
However, in a separate
report by CNBC, a judge in the same federal court that handed Ripple the
partial victory, issued a contravening opinion that cryptocurrencies are
considered securities regardless of the context in which they are sold. The
opinion by Judge Jed Rakoff gave the SEC the green light to pursue its lawsuit
against Terraform
Labs and its Founder Do Kwon.
However,
the opinion reportedly complicates the legal tussle between the agency and
Ripple, and several other pending cases pitting the SEC and crypto companies. In
June, the regulator sued Coinbase for allegedly issuing unregistered securities
and operating an illegal trading platform. However, the exchange has disputed
the claims, saying the
regulator has no jurisdiction over cryptocurrencies.
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- Source: https://www.financemagnates.com//cryptocurrency/sec-moves-to-overturn-ripple-labs-landmark-court-victory/
