KEY POINTS
- Ripple CLO Stuart Alderoty said he can't wait to finally end Gensler's war on crypto
- Judge Torres ruled in 2023 that $XRP sales in exchanges through algorithms didn't constitute investment contracts
- Prominent crypto podcaster Chip said the SEC forced Ripple's hand instead of just walking away from the case
Less than a week after the U.S. Securities and Exchange Commission (SEC) filed a notice to appeal the court's 2023 ruling over the XRP token's status as a non-security, Ripple Labs, which is closely associated with the cryptocurrency and is the token's largest holder, filed a notice to cross-appeal.
The notice was filed Thursday, with Ripple's Chief Legal Officer Stuart Alderoty declaring that he expects the Wall Street regulator to lose the legal fight. "We look forward to the federal court of appeals finally putting a stake in the heart of [Gary] Gensler's misguided attack on our industry," he said in a statement on X.
The SEC lost on all key points—that’s why they appealed. Today, Ripple filed a cross-appeal to ensure nothing’s left on the table, including the argument that there can’t be an "investment contract" without there being essential rights and obligations found in a contract.
— Stuart Alderoty (@s_alderoty) October 10, 2024
What Was the Ruling?
The SEC sued Ripple in 2020 over its alleged illegal security offering in the XRP token. In mid-2023, District Judge Analisa Torres ruled that while the institutional sales of XRP violated federal securities law, the token's sales in exchanges through algorithms did not constitute investment contracts.
The ruling marked a partial yet significant victory for Ripple, especially since the SEC has repeatedly based its lawsuits against crypto firms on "whether a digital asset has the characteristics of one particular type of security – an 'investment contract.'"
Last week, the SEC filed a notice to appeal the said ruling, drawing criticism from the crypto community and crypto lawyers who believe the financial regulator is betting on a losing fight.
On the other hand, Ripple has vowed to continue fighting the SEC and defending its stance that XRP is not a security and thus should not be regulated by the SEC.
Crypto Community Cheers Ripple On
Crypto users and experts alike didn't fail to express support for Ripple in its continuing battle against the SEC, with some urging politicians who have said they support the industry to speak up.
Crypto lawyer James Murphy, also known as MetaLawMan, said "pro-innovation politicians" should come out in support of Ripple by filing amicus briefs, legal documents filed by parties not involved in a current case that provide relevant expertise and information.
It's on.
— MetaLawMan (@MetaLawMan) October 10, 2024
Respect to @s_alderoty, @bgarlinghouse and the whole @Ripple legal team.
The crypto industry and pro-innovation politicians need to gear up to support @Ripple with amicus briefs.
On the Chain podcast founder Chip said the "SEC just sealed their own fate" in the Ripple case after appealing. He said that the fintech and digital asset custody firm would have just walked away if the regulator just let the ruling be.
The SEC just sealed their own fate.
— Chip – onthechain.io (@stephenchip) October 10, 2024
Had they simply walked away without appealing, Ripple would’ve likely done the same.
But by filing, they forced Ripple’s hand.
Ripple doesn't back down.
Now, Ripple will take great pleasure in humiliating Gensler and the SEC.
Gensler is…
One user said the SEC's appeal was just an attempt to "save face" but it will only "erode" what's left of the public's trust in Wall Street's top regulator.
Meanwhile, XRP prices have been climbing in the last 24 hours. The token is up by 2.5% following news of Ripple's cross-appeal notice. The crypto token has also increased by 2.7% in the past week.
