Ripple Lawsuit News : Implications for Crypto Regulation in the Latest Court Appeal

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The U.S. Securities and Exchange Commission made a statement on Wednesday about its appeal of the court ruling that restricted its ability to regulate the cryptocurrency market. Ripple executives have expressed their disappointment over the decision terming it as ‘misguided’ and ‘infuriating’ but not a surprise. Taking charge of the situation, Ripple is determined to fight in court, while also affirming XRP’s status as a non-security as the ‘law of the land today’.

In the latest podcast on Thinking Crypto, Attorney Fred Rispoli shared his views on the SEC appealing Judge Torres’s ruling in the Ripple XRP case lawsuit. He also discussed various aspects like why did the SEC appeal, and what are the chances of Ripple winning it.

Ripple’s Winning Odds: Will It Be 50-50 or 70-30?

When Edward asked Fred if he was anticipating the appeal or if it was 50-50 for him, he replied that while he was hoping that it wasn’t going to happen, at the end of the day, he thought that it was going to be a 60 40 in favor of an appeal. He also shared that there are a lot of risks for the SEC and Ripple as well. 

Fred voiced that if there is a panel that has a long history of agreeing with the government on everything, then SEC’s chances go up and that there could be a 70-80% chance that they’re going to win as well.

If it’s more of an average type of situation or more favorable to Ripple, then Ripple’s chances go up. And if it’s a fairly divided panel or an average justice, then he thinks that the odds are much more in favor of Ripple. In his opinion, at the end of the day, every institution in America, and not just the SEC, is getting more and more political, and rarely any institution now has any accountability. 

SEC Targets Ripple’s Programmatic Sales: What’s at Stake?

When asked why he thinks the SEC appealed this ruling, he expressed that they’re going to appeal everything they lost. And some of their arguments are going to be a little bit better received than others in terms of the merits. He shared that they can appeal anything that was discussed in the summary judgment motion and ruling there, which is a lot.

The only thing they’re really going to do in his opinion is programmatic sales and other distributions. He noted that there were three categories and that programmatic sales is where it’s critically important, and there’s a little bit of a nuance. 

“The summary judgment opinion did not talk about secondary sales in the sense of you and I buying and selling from each other on Coinbase, it was explicitly excluded in the opinion, but in a way, it wasn’t because the programmatic sales for Ripple is just Ripple selling on an exchange. But you could easily make the argument, well, what’s the difference between Ripple selling XRP and Tony selling XRP to me on an exchange? And so that’s why the SEC wants to take it out, is because that argument can be used for the secondary sales as everybody kind of thinks about it, which is me, you, anybody else selling it.”

Is This SEC’s Pursuit of Higher Fines?

He also assumes that they are going to appeal the money as well. If there are no losses and they’re going to try and get a higher fine, which however he doesn’t think that’s going to go their way. 

He stressed that the only thing that’s the most dangerous for XRP holders is what’s going to happen on this programmatic sales, and that is not just for XRP holders, but it is going to be bad for Coinbase, Kraken and other exchanges as well if the SEC triumphs in the second circuit.