Ripple’s CEO criticizes the SEC’s use of their XRP Markets Report as evidence in an ongoing court action, while a ruling states that XRP should not be classified as a security.
- Ripple’s CEO expressed strong disapproval of the SEC’s use of their XRP Markets Report as evidence in an ongoing court action.
- The report highlighted an increase in Ripple’s XRP holdings but a decrease in total XRP held in ledger escrow, potentially due to increased demand.
- Judge Torres ruled that XRP should not be classified as a security, a significant victory for Ripple, but sales under certain contracts may still fall under the security categorization.
- The legal battle between Ripple and the SEC has sparked debates in the cryptocurrency community, with implications for the future regulation of digital assets.
On August 2, 2023, Brad Garlinghouse, the Chief Executive Officer of Ripple, expressed his strong disapproval of the United States Securities and Exchange Commission (SEC). This was in response to the SEC’s use of Ripple’s quarterly XRP Markets Report as evidence against the company in an ongoing court action.
The controversy stems from Ripple’s presentation of the Q2 2023 XRP Markets Report on July 31, 2023. The report covered various significant updates, including a summary judgment ruling by Judge Torres, clarifications on misconceptions, and statistics on Ripple’s XRP holdings.
An important topic has come up about protecting retail. The SEC created this mess by proclaiming it was the cop on the crypto beat when it had no legal jurisdiction Where’s that gotten us? Consumers left holding the bag in bankruptcy court while the SEC holds press conferences.
— Brad Garlinghouse (@bgarlinghouse) July 22, 2023
One of the key highlights of the report was the increase in Ripple’s XRP holdings from 5,506,585,918 to 5,551,119,094, reflecting a gain of nearly 45 million.
However, it’s worth noting that the total amount of XRP held in ledger escrow decreased by over 1 billion. This shift in the market could be attributed to a surge in XRP demand.
During the ongoing court action against Ripple brought by the SEC, the attorney representing XRP, John Deaton, strongly criticized the use of the XRP Markets Report as evidence.
Deaton argued that the SEC’s tactics were inconsistent with those used against other companies, further highlighting the controversial nature of the case.
In a noteworthy development on July 13, 2023, Judge Torres issued a finding in the case of the Securities and Exchange Commission v. Ripple Labs. The finding stated that XRP should not be classified as a security. This decision was made public on the same day, offering a significant victory for Ripple.
However, Ripple clarified that sales of XRP under written contracts could be classified as investment contracts and fall within the security categorization. It is worth mentioning that Ripple Labs was the defendant in the litigation that led to the SEC’s decision.
Addressing concerns about the partial success achieved, Ripple acknowledged that while XRP may not be considered a security in certain contexts, there are specific situations where it could be treated as one. The verdict, therefore, provides protection to sophisticated institutions but not retail clients.
Ripple emphasized the importance of clarifying any misunderstandings arising from their partial success. They also highlighted that the judgment does not guarantee protection for retail purchasers of XRP, indicating that investors should remain cautious.
The ongoing legal battle between Ripple and the SEC continues to spark intense debates within the cryptocurrency community. The outcome of this case will have significant implications for the future classification and regulation of digital assets.