- The SEC has launched an interlocutory appeal against Ripple, but crypto lawyers remain confident in Ripple’s standing.
- While some experts believe the appeal won’t alter XRP’s non-security status, others feel the SEC is still challenging it.
Deconstructing the SEC’s Move
The crypto community has been keenly watching the legal tussle between the United States Securities and Exchange Commission (SEC) and Ripple Labs. With the SEC recently introducing an interlocutory appeal, there’s been significant speculation around the XRP token’s status as a security.
On August 9, the SEC, expressing its intentions to revisit the court’s verdict, approached Judge Analisa Torres. The regulatory body proposed a temporary halt to the case during the appeal process. This decision kindled numerous questions, chiefly about the SEC’s intentions regarding the “non-security” label of XRP. Nonetheless, voices from the legal crypto fraternity have sought to dispel undue concerns.
Crypto lawyer Jeremy Hogan delineated that the SEC’s appeal and XRP’s security status are distinct matters. According to Hogan, a successful SEC appeal would hinder Ripple from facilitating sales on exchanges. Yet, he emphasized that this doesn’t prohibit other exchanges from listing XRP, provided Ripple isn’t the seller.
A Deeper Look into the SEC’s Strategy
To demystify some complexities of the SEC’s action, Cointelegraph consulted Oscar Franklin Tan, chief legal officer at the nonfungible token (NFT) platform, Enjin. He provided clarity on the nature of interlocutory appeals, which are typically sought before a case’s conclusion. Tan illustrated the significance of momentum in such appeals: should the appeal be sanctioned, the victorious party would gain a favorable position in the primary case.
While Hogan’s perspective suggests the appeal won’t challenge XRP’s non-security designation, Tan offers a contrary view. He perceives the SEC’s continued intent to negate Judge Torres’ previous verdict, which identified XRP as a non-security in particular scenarios.
Shedding light on the SEC’s approach, Tan highlighted the regulator’s reference to the Terraform Labs case outcome as leverage against the judge in the Ripple case. He suggested that the SEC is hinting at a higher court’s intervention to reconcile divergent verdicts. Nonetheless, Tan’s perspective remained critical of the SEC’s tactics. He suggested that instead of rushing to litigation, the SEC should have offered clearer guidelines. With Ripple and other entities seeking clarity from the courts, Tan believes the standard legal processes should unfold without interference.
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Amid these legal oscillations, Ripple’s chief legal officer, Stuart Alderoty, has advised the community to remain vigilant, hinting at Ripple’s imminent court response.
The SEC does not have the “right” to appeal just yet which is why they are asking permission to file an “interlocutory” appeal. Ripple will file its response with the Court next week. Stay tuned. https://t.co/zCeVZhYfxc
— Stuart Alderoty (@s_alderoty) August 9, 2023
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