The ongoing legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has reached a critical turning point, with recent developments indicating a potential delay in the legal proceedings.
Ripple vs. SEC prepares for extended fight: Is XRP in balance?
The relief phase of the lawsuit has progressed. In a recent ruling, the U.S. District Court for the Southern District of New York ruled in favor of the SEC’s motion. Judge Sarah Netburn ordered Ripple to provide financial statements and contracts related to “institutional sales” from 2022 and 2023. This step sets the stage for an extended legal proceeding with a focus on determining appropriate legal remedies.
However, since this is part of the relief phase of the lawsuit, Ripple must comply with the request. However, many legal experts expect Ripple to appeal to the Second Circuit after this filing, which could prolong the court battle even further.
Since the two sides cannot agree on the classification of XRP sales, the court will now decide the case based on 2022-2023 financial documents. A 2023 court ruling determined that sales of XRP on cryptocurrency exchanges did not constitute securities transactions, but raised important legal questions by distinguishing institutional sales of XRP from potentially unlawful securities transactions.
However, the SEC wants to maintain its power and credibility in the cryptocurrency world. They are hesitant to agree that selling XRP is not a securities transaction. This is because it may weaken your position against large exchanges such as Coinbase or Binance. These differences in goals make it difficult to find a solution to the conflict.
Ripple asks for more time
Meanwhile, Ripple asked the court to give it more time to gather information. They’ve already provided some financial documentation, but they say it’s too difficult to gather details by the deadline. They want just one more week to finish, until February 20, 2024. Ripple said the case won’t take longer because the SEC also has time to prepare.
XRP Lawyer Says Ripple Is Still in the Game!
Pro-XRP lawyers reacted to Ripple’s extension request. Bill Morgan questioned the significance of only an eight-day delay after a lengthy legal battle. He highlighted important issues surrounding the sale of XRP to On-Demand Liquidity (ODL) customers. The legal conflict between Ripple and the SEC is expected to escalate. He also talked about new rules from the SEC that could impact cryptocurrency trading. Attorney Fred Rispoli, on the other hand, believes that the SEC is targeting Ripple, but believes that despite the lawsuit, Ripple is still ahead.
The standoff between Ripple and the SEC means the XRP community may have to deal with a prolonged period of uncertainty until the issue is resolved. Either way, appealing to a higher court, such as the U.S. Court of Appeals, may result in a longer legal process. This update shook up the XRP community again. Will this cause more problems?