Outcome of legal battle between Ripple and SEC may soon be decided
A pro-XRP legal expert has offered his opinions on the likely results of the well-reported litigation between the United States Securities and Exchange Commission (SEC) and Ripple, which is nearing its conclusion.
Indeed, in a Twitter thread published on March 10, Scott Chamberlain, a former attorney, and co-founder of the permissionless Layer 2 platform Evernode XRPL listed five potential scenarios for the resolution of the lawsuit, including summary judgments, the potential for settlement and subsequent cases.
2. Summary Judgement for Ripple in Respect of Overseas sales – Ripple’s sales of XRP on overseas exchanges are not within the court’s jurisdiction. A wholly new precedent would be set to deem those domestic transactions finalised in the US.
— Scott Chamberlain (@scotty2ten) March 10, 2023
The legal expert stated that he didn’t believe the regulator had “anywhere near the evidence to support they knowingly or recklessly sold an unregistered security” about Ripple CEO Brad Garlinghouse and co-founder Chris Larsen.
Regarding the summary ruling for Ripple on international sales, Chamberlain opined that “Ripple’s sales of XRP on overseas exchanges are not within the court’s jurisdiction” and that “a wholly new precedent would be set to deem those domestic transactions finalized in the US.”
“Summary Judgement dismissing the part of the case that asserts XRP itself is a security – no precedent supports the digital asset itself being a security. This claim was a contrivance for the SEC not to have to prove each sale and to avoid the problem of overseas sales”, he stated.
Chamberlain emphasized that this complaint may lead to a limited case investigating whether any of Ripple’s sales of the XRP coin in the U.S. contained an unregistered investment contract.
The founder of Evernode XRPL believes that the fifth and final possibility is that the lawsuit will be resolved, given that precedents regarding the claim that XRP is a security and the court’s authority over international sales have been established. “I happen to believe the SEC underestimated that most of Ripple’s sales occurred on overseas exchanges through algorithmic trading. Once overseas and secondary market sales are excluded, there’s insufficient meat left on the bone”, according to his reasoning.
While Judge Analisa Torres decided on both parties’ applications to exclude specific expert witnesses, particularly one that Chamberlain and Ripple’s amicus curiae John E. Deaton found detrimental to the SEC’s argument, Ripple’s legal team has won the conflict with the financial watchdog.
The New York Attorney General Letitia James filed a lawsuit against KuCoin, accusing the cryptocurrency exchange of acting illegally as a securities and commodities broker-dealer without being authorized in the state.
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