Crypto lawyers predict a prolonged legal battle between Ripple and the SEC, with contentious issues over penalties and jurisdiction to be addressed.
Key Takeaways
- Lawyer Bill Morgan predicts an intense legal battle between Ripple and the SEC.
- SEC initially sought $1 billion in penalties, later revised to $770 million.
- Key contention centers around distinguishing institutional sales from non-institutional ones.
- Ongoing Coinbase lawsuit may impact the SEC’s stance on crypto companies.
Ripple Labs and the U.S. Securities and Exchange Commission (SEC) find themselves locked in a protracted legal dispute that shows no signs of easing. Renowned crypto lawyer Bill Morgan, known for his insightful analysis of the case, has shed light on the future of this courtroom drama.
Battle Forecasting In Crypto
Taking to Twitter, Morgan delved into the remedies phase roadmap, as outlined in recent court filings. His prognosis: a full-blown legal showdown between Ripple and the SEC.
“The remedies phase in the #SEC v Ripple matter will be full on. It will heat up not settle,” Morgan remarked, dismissing the likelihood of an amicable settlement at this juncture.
Initially, the SEC sought an astronomical $1 billion in penalties from Ripple, but that figure was later trimmed down to $770 million. Ripple’s strategy revolves around substantially reducing this penalty, particularly by excluding certain XRP sales to commercial customers.
Ripple’s letter to the court has shed light on the key points of contention that will dominate the proceedings. A crucial issue centers on distinguishing institutional sales from non-institutional ones, an aspect underscored by Morgan.
This dispute takes on heightened significance due to the substantial sums involved, particularly in post-complaint sales to On-Demand Liquidity (ODL) customers for cross-border payments. Morgan argues that these transactions may not fit the definition of investment contracts, as ODL customers are not investing in XRP for profit.
Moreover, questions surrounding the SEC’s jurisdiction in transactions involving institutional sales remain unresolved, particularly those transactions with no connection to the United States.
Crypto Lawyers Predict Prolonged Fight in Ripple-SEC Case.
The SEC initially sought over $1 billion in penalties from Ripple, which was later revised down to $770 million.
https://t.co/nirLj4QYJS— 🇳🇱 MackAttackXRP® 🇳🇱 65K-XRP-Followers (@MackAttackXRP) October 26, 2023
Lawyer John Deaton, who closely follows the case, echoes Morgan’s sentiments regarding settlement talks. He suggests that no serious negotiations have taken place between Ripple and the SEC.
Deaton underscores Ripple’s determination to significantly reduce the $770 million penalty, emphasizing their intent to exclude ODL transactions and make cuts in various expenses. Drawing parallels to the LBRY case, he highlights the time-consuming nature of these legal proceedings, with a final judgment likely not arriving before late summer 2023, and appeals potentially extending into 2024.
The ongoing Coinbase lawsuit against the SEC holds a pivotal role in this legal saga. If Coinbase manages to secure a dismissal, Deaton believes the SEC may be compelled to soften its stance towards crypto companies like Ripple. Until then, both parties seem poised for an extended courtroom battle.
To Conclude
The Ripple-SEC legal showdown continues to captivate the crypto world, with experts predicting a protracted battle. As the crypto landscape evolves, the outcome of this case could significantly influence how regulatory bodies approach digital assets and their associated companies. Stay tuned for further updates on this unfolding drama.
