SEC to seek appeal and stay in Ripple Labs court case

The United States Securities and Exchange Commission is moving to appeal a July court choice from its lawsuit against Ripple Labs, which had ruled the sale of XRP (XRP) is not a security when sold to retail investors.In an Aug. 9 letter to Judge Analisa Torres– the presiding judge in the event– the SEC said it thought her choice warrants a fresh appearance by an appellate court.It asked Judge Torres to put the case on hold throughout the appeal, saying there are several other pending lawsuit that could be impacted depending upon the appeals result. The SEC is currently in a legal fight with a number of crypto companies, including Binance and Coinbase, over supposed securities violations. ” Interlocutory evaluation is called for here,” the SEC wrote, asking the ruling to be evaluated while the case is still pending. “These two concerns involve managing questions of law on which there is substantial ground for disagreements as shown by an intra-district split that has actually already developed.” The SEC added it looks for to certify the courts choice that Ripples programmatic XRP deals and sales on crypto exchanges and private sales were not securities.AND … the SEC continues making doubtful choices, asking for an interlocutory appeal.Note that it is NOT appealing whether XRP itself is a security – just its losses on the programmatic and specific sales problems. https://t.co/GziVLp23mT— Jeremy Hogan (@attorneyjeremy1) August 9, 2023

The SEC likewise highlighted the judges choice in its fit versus Terraform Labs who declined Torres ruling, stating cryptocurrencies sold on exchanges might likewise be securities.Related: CoinGecko now has an index for crypto tokens declared as securitiesThe SECs letter comes nearly a month after Ripple scored a partial victory over the SEC concerning the securities status of XRP. Torres ruled that the XRP token was not in itself a security. She said, however, that sales of XRP tokens can be securities in certain situations, such as when offered to institutional investors but not when offered on exchanges to retail traders.Hall of Flame: Crypto Wendy on trashing the SEC, sexism, and how underdogs can winAdditional reporting by Jesse Coghlan.

Other Questions People Ask

What is the SEC's position in seeking an appeal and stay in the Ripple Labs court case?

The SEC is seeking an appeal of a July court ruling that determined XRP is not a security when sold to retail investors. In its letter to Judge Analisa Torres, the SEC argues that the decision warrants further review by an appellate court due to significant legal questions. Additionally, the SEC has requested a stay on the case during the appeal process, citing potential impacts on other pending lawsuits involving crypto companies.

How does the SEC's appeal affect Ripple Labs and its XRP sales?

The SEC's appeal focuses specifically on the sales of XRP tokens, arguing that while XRP itself may not be a security, certain sales could be classified as such, particularly to institutional investors. This appeal could have significant implications for Ripple Labs, as it may affect how XRP is traded and perceived in the market. The outcome of this appeal could also influence ongoing legal battles with other crypto firms facing similar scrutiny from the SEC.

What are the potential consequences of the SEC's request for an interlocutory appeal in the Ripple case?

The SEC's request for an interlocutory appeal indicates that it believes there are substantial legal grounds for disagreement regarding the court's ruling. If granted, this could delay the resolution of the case and impact Ripple's operations and XRP's market status. Furthermore, it may set a precedent for how other cryptocurrencies are treated under securities law, especially in relation to sales on exchanges versus private transactions.

Why did the SEC highlight its case against Terraform Labs in relation to its appeal in the Ripple Labs case?

The SEC referenced its case against Terraform Labs to underscore the complexities surrounding cryptocurrency sales and their classification as securities. By doing so, the SEC aims to illustrate that there is an ongoing debate within the legal framework regarding how cryptocurrencies should be regulated. This context strengthens its argument for an interlocutory appeal, emphasizing that similar issues are being contested in multiple cases.

What does the SEC hope to achieve with its appeal in the Ripple Labs court case?

Through its appeal, the SEC aims to clarify legal ambiguities surrounding the classification of XRP sales, particularly those made on exchanges versus private sales. The agency seeks to establish a definitive legal standard that could guide future cases involving cryptocurrencies. Ultimately, the SEC hopes that a favorable ruling will reinforce its regulatory authority over digital assets and provide clearer guidelines for compliance within the crypto industry.