Ripple v. SEC: The Case So Far and What’s Next for the XRP Price?

  • Background: In December 2020, the US Securities and Exchange Commission (SEC) charged Ripple with conducting an unregistered $1.3 billion security offering.
  • Clash of Titans: Ripple’s defense is based on its claim that XRP is a currency and not a security.
  • Legal Battle: The legal battle has been ongoing for two and a half years resulting in larger proportions.

Background: The Initial Charges Against Ripple Labs Inc.

In December 2020, the United States Securities and Exchange Commission fired the first bullet in what would eventually become a dragged-out legal battle against the entire cryptocurrency industry. On December 22nd, 2020, the SEC charged Ripple with conducting an unregistered $1.3 billion security offering, essentially alleging that their native cryptocurrency – XRP – is a security.

Clash of Titans: Ripple’s Claim That XRP Is Not A Security

Ripple’s entire defense is based on its claim that XRP is a currency and not a security. Nonetheless, back then Director of the SEC’s Enforcement Division Stephanie Avakian said, “We allege that Ripple, Larsen, and Garlinghouse failed to register their ongoing offer and sale of billions of XRP to retail investors…” These statements set off an enormous legal battle between one of the world’s most powerful financial regulatory agencies versus one of crypto’s most influential companies.

Legal Battle So Far

Two and a half years later since these charges were filed against Ripple Labs Inc., this case has been dragging on for months with no clear sign as to when it will be resolved. There have been numerous court hearings where both sides argued their cases before Judge Torres who was appointed by President Obama in 2013 to preside over this case in New York District Court. The parties are now waiting for Judge Torres‘ ruling which could come anytime in 2021 or 2022 depending on how long she takes to consider all data presented before her during multiple court hearings.

What’s Next For The XRP Price?

The outcome of this case will have huge implications for not only Ripple but also for cryptocurrencies at large since it could set precedents regarding what constitutes as a security token or not down the line. Moreover, if Judge Torres rules in favor of the SEC then this could result in massive fines being imposed upon both individuals like Chris Larsen & Brad Garlinghouse as well as potential delisting from exchanges across various crypto ecosystems leading to massive selloffs resulting in decreased prices across different crypto markets including Bitcoin (BTC). On other hand if she rules against them then it will be seen as another major win for cryptocurrencies overall which could lead to increased demand due to investor confidence being restored leading potentially higher prices across many different digital assets including XRP itself!

Conclusion

The future remains uncertain however we can expect more updates from both sides soon enough until then stay tuned!