Ripple Responds as SEC Files Appeal in XRP Case

By: Eva Baxter

Ripple remains steadfast as the U.S. Securities and Exchange Commission (SEC) formally filed an appeal concerning specific elements of a previous judicial ruling. This development comes from the ongoing legal struggle where the SEC continues to explore its regulatory boundaries with Ripple in relation to the cryptocurrency XRP. Notably, the appeal filed on October 17 underscores the SEC's focus on Ripple's programmatic sales of XRP on trading platforms rather than retail sales which were previously ruled not to violate U.S. securities laws.

Judge Analisa Torres had previously concluded that sales of XRP to retail investors through exchanges were not in breach of securities law, offering Ripple a significant win. However, the regulatory body is now challenging aspects related primarily to institutional sales and distributions. The appeal also criticizes Ripple executives Brad Garlinghouse and Chris Larsen, accusing them of aiding and abetting XRP sales on digital platforms. The SEC has requested the appellate court to rethink these issues and provide a 'de novo' review, meaning an independent evaluation absent deference to the prior trial court's judgment.

Ripple's Chief Legal Officer, Stuart Alderoty, has conveyed that the ruling regarding XRP not being a security remains unappealed and suggests Ripple's confidence as they plan to submit a cross-appeal soon. He clarified that the core verdict—which states XRP is not classified as a security under current laws—remains unchallenged and maintains its validity as law of the land. Alderoty emphasized that the SEC’s intent continues to focus narrowly on specific sales and distributions while not opposing the retail sales ruling.

As legal proceedings progress, the Ripple community and broader cryptocurrency markets watch closely, as outcomes from this case may set influential precedents affecting the regulatory landscape for digital assets in the U.S. For now, Ripple prepares for the next stages in this complex legal process, reaffirming their commitment to asserting and defending decisions which favor their operations while navigating the intricate legality of securities within the cryptocurrency domain.