Can Ripple afford to break out before the SEC in the nagging case?
Ripple has won a small victory in its legal battle with the U.S. Securities and Exchange Commission (SEC) that has dragged on for more than a year. A federal judge has ruled granting Ripple access to emails in the SEC, which Ripple believes will help its case.
Ripple will be given access to emails relating to a contentious 2018 SEC speech about Ethereum
Ripple recently won a notable victory in their legal dispute with the SEC. This comes as U.S. District Court Judge Sarah Netburn ruled that emails surrounding a speech by a senior member of the committee on Ethereum in 2018 were not qualified to be protected by Deliberative Process Privilege.
A speech that was given at the time by the then Director, Division of Corporate Finance of the SEC, William Hinman, disclosed to participants at a Yahoo Finance Crypto Summit that Ethereum, a cryptocurrency like Ripple’s XRP, was not a security. He added that the token was well decentralized.
The speech became a point of contention in a year-long legal battle that has seen the SEC assert that Ripple and its co-founders were aware that XRP was a security that needed to be protected registered with the SEC but went ahead and sold it without following due process.
Ripple’s team sought to shed light on the premise that the regulator decided that Ethereum was not security in hopes that it would enable them to reveal inconsistencies in the suit against them and prove that XRP is also not a security.
The judge’s decision includes documents issued by the SEC’s Head of Innovation and Financial Technology, Valerie Szczepanik, concerning various internal deliberations by the commission and mail sent between Hinman and other members of the SEC, discussing the preparation of the now contentious speech.
In making her decision, Judge Sarah Netburn revealed that the details in the documents did not contain anything that revealed the essential links in the deliberation and, therefore, could not be protected by exclusive rights.
While it is a small milestone, the ruling is a direct result of the resilience of the Ripple team, who have been pursuing the decision for several months. From the outset, Ripple’s stance was against what seemed to be the norm to many who have faced similar claims from the SEC. The team decided to face the SEC directly in court instead of settling it out of court.
This lawsuit, which took place in late 2020, has seen XRP lose more than half of its value and its position against market leaders Bitcoin and Ethereum. The case’s outcome is being watched by many market participants as there are many threats to both sides. Ripple CEO Brad Garlinghouse has said that the SEC’s action afflicts the entire crypto industry.
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