The question behind this much talked about lawsuit is whether the company Ripple has offered unauthorized securities for sale through its XRP token. But beyond the simple lawsuit, this is a topic that poses a real threat to not only Ripple, but the entire cryptocurrency industry.
In fact, if the judge decides that XRP is a security, Ripple is likely to collapse, and the decision will give the SEC a powerful weapon to tackle other blockchain projects.
Despite this pressure, Ripple refused to compromise. Instead, she tried to turn the table on the SEC and mounted aggressive legal defense and by very publicly condemning the dubious conduct of the Agency. Now, almost a year and a half after the case started, it is reaching a critical point.
When companies face a lawsuit from the SEC, they usually prefer to compromise rather than fight. This is because the SEC only sues when it believes it has a strong case and the fact that lawsuits are terribly expensive.
However, money is not an issue for Ripple. The company has made huge sums of money selling XRP, which means it has the funds to hire the best securities lawyers in the country, including former SEC President Mary Jo White.
Nevertheless, Ripple’s legal team achieved some notable victories in the early stages of the case, including securing the right to obtain a deposit from former SEC Director Bill Hinman and forcing the agency to release documents describing some of its internal considerations. .
Although the specific content of these documents – including minutes from internal SEC meetings – has not yet been published, it is likely that they will strengthen Ripple’s position when it comes to claiming that the Agency’s cryptocurrency policy has been arbitrary and unclear.
Meanwhile, revelations about Hinman, the agency’s former chief financial officer, could prove embarrassing for the SEC. In fact, his actions have already taken on an unusual aspect, especially when in 2018 he made the decision to declare that Ethereum was not a security on the basis of an unprecedented legal test. Shortly after, he left the SEC to return to his law firm, which has links to the Ethereum Foundation.
Ripple was less successful in forcing the SEC to hand over crypto-trading documents from the agency’s own staff. The company had hoped to show that the agency had long been indifferent to these transactions – which, if true, would have helped Ripple argue that the SEC itself does not consider XRP and other tokens to be securities. .
Very wise who can predict the outcome of this lawsuit. All we know is that the judge, Sarah Netburn, agreed that these documents were confidential and could not be part of the case.
The result is that it is unclear whether Ripple in the preceding phase of the case found irrefutable evidence among the SEC documents, or whether its aggressive tactics will give it any advantage.
Netburn is known to have rejected Ripple’s attempt to dismiss the case against the SEC following a request to dismiss. Presumably, the SEC provided enough evidence in the early stages for the case to proceed.
“We will continue to fight hard to defend this cause so that the sector can get the clarity it deserves to move forward and thrive. And although we would have preferred the cases against Brad and Chris to be closed now, the court has decided to force the cases DRY to prove his claims. We are confident that all of the SEC’s complaints will eventually be dismissed, ”said Stuart Alderoty, the firm’s lead attorney, in response to the judge’s refusal to dismiss the motion for dismissal.
It is the very future of the cryptocurrency economy that is at stake in this lawsuit. If Ripple loses, it’s natural that the other cryptocurrencies will now also be sued by the SEC. The coming days will therefore be very crucial.
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Luc Jose Adjinacou
Far from dampening my enthusiasm, a failed investment in 2017 on a few cryptocurrencies only increased my enthusiasm. I therefore decided to study and understand blockchain and its many uses and with my ball to pass on information about this ecosystem.