On Oct. 2, the US Securities and Exchange Commission filed a notice of appeal in the Ripple lawsuit seeking to overturn an earlier ruling.
The agency has appealed a 2023 verdict set by Judge Torres, which ruled that secondary sales of Ripple’s XRP token did not constitute securities sales.
The judge ruled that XRP failed to satisfy all the conditions for the SEC’s Howey test to be classified as an investment contract.
The filing was shared by defense lawyer James Filan on X.
#XRPCommunity #SECGov v. #Ripple #XRP BREAKING: The @SECGov has filed a Notice of Appeal of Judge Torres’s Ruling. pic.twitter.com/j8bLIZQ5LT
— James K. Filan (@FilanLaw) October 2, 2024
Ripple Fights Back
Ripple chief legal officer Stuart Alderoty said the appeal was “disappointing, but not surprising.”
He added that this just prolongs what is “already a complete embarrassment for the agency.”
“The Court already rejected the SEC’s suggestion that Ripple acted recklessly, and there were no allegations of fraud and, of course, there were no victims or losses.”
He said that the SEC “continues to engage in litigation warfare against the industry” before adding that the firm is evaluating whether to file a cross-appeal.
Ripple CEO Brad Garlinghouse also addressed X on Oct. 3, stating that if SEC chair Gary Gensler and the regulator were rational, “they would have moved on from this case long ago.”
He vowed to continue fighting as long as necessary:
“While we’ll fight in court for as long as we need, let’s be clear: XRP’s status as a non-security is the law of the land today – and that does not change even in the face of this misguided – and infuriating – appeal.”
If Gensler and the SEC were rational, they would have moved on from this case long ago. It certainly hasn’t protected investors and instead has damaged the credibility and reputation of the SEC.
Somehow, they still haven’t gotten the message: they lost on everything that… https://t.co/1hW7xVSL9b
— Brad Garlinghouse (@bgarlinghouse) October 2, 2024
Candidate for Massachusetts Senator John Deaton unleashed a tirade on X, stating that a candidate wouldn’t typically comment on an appeal:
“However, I’m not your typical candidate and I spent hundreds of pro bono hours and over $75K of my own money, fighting gross overreach and misconduct at the SEC.”
Almost four years after suing Ripple and making the above ridiculous claims, SEC lawyers apologized (in a different case) for suggesting tokens themselves were securities, he said before adding:
“Because the SEC is pursuing an anti-crypto agenda, it will now waste more taxpayer money. Gary Gensler is a disgrace.”
XRP Tanks
The news has rattled XRP holders who have been aggressively selling the asset, resulting in a 12% slump on the day.
The asset was trading above $0.60 on Oct. 2 but crashed to bottom out at just below $0.53 during early trading in Asia on Thursday morning.
XRP is currently at a three-week low and still trading down 84% from its January 2018 all-time high despite recent ETF applications.
Source: CoinGecko