- Ripple Labs has identified a potential loophole in its legal battle with the U.S. Securities and Exchange Commission (SEC) that could impact the outcome of the ongoing class-action lawsuit.
- The lawsuit’s lawyers may be quietly hoping for Ripple to win the SEC case, which could redirect penalties away from the plaintiffs and possibly establish a compensation fund for XRP holders.
Ripple’s Potential Ace in the Hole
In an unexpected development, Ripple Labs seems to have identified a possible legal loophole in its ongoing confrontation with the U.S. Securities and Exchange Commission (SEC). This discovery could significantly sway the resolution of the present class-action lawsuit.
A Twisted Motive Exposed by Deaton
John Deaton, an active figure in the Ripple-SEC case, posted a tweet hinting that the attorneys representing the class-action plaintiffs may clandestinely be rooting for Ripple’s triumph. The rationale? If the SEC lands a substantial victory, the regulatory body would collect the resulting fines and penalties, not the aggrieved parties. This unexpected twist could establish a compensation fund for XRP holders, thereby subverting the entire class-action lawsuit.
The Central Issue: Is XRP a Security?
The main question fueling both the SEC case and the class-action lawsuits is whether XRP should be classified as a security. This contention has been a recurring theme in Ripple’s legal struggles in recent years, adding an extra layer of complexity to the ongoing drama.
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An Assurance for International XRP Holders
Deaton further elaborated that the certified classes in the class-action lawsuit only include U.S. investors. This stipulation offers a sense of relief to XRP holders outside of the U.S., as regulatory authorities in countries such as the United Kingdom, Japan, Singapore, and the United Arab Emirates have already established that XRP does not fall under the security category in their respective jurisdictions. Hence, these international XRP holders remain untouched by the certification of the class-action lawsuit.
In the midst of battling on two fronts – the SEC lawsuit and the certified class-action – Deaton’s revelation hints that the SEC case outcome could indeed be the pivotal factor that changes the game. The stakes, it appears, have never been more elevated.
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