In a groundbreaking legal victory for Ripple, the United States SEC suffered a significant blow as the court ruled in favor of Ripple, stating that the crypto asset XRP is not a security. Ripple CEO, Brad Garlinghouse, expressed his overwhelming gratitude for his team and the outcome through a tweet.
Ripple’s Legal Win Impacts The Entire U.S. Crypto Industry
According to the blog post from the company, the court’s decision on July 13th marked a historic occasion for Ripple and the entire U.S. crypto industry. It set a precedent for regulating other crypto assets, tokens, and securities in the country.
The case’s core revolved around whether XRP, as a digital token, could be considered an investment contract and, consequently, a security under the law.
The court unequivocally declared that XRP, standing alone as a digital token, is not a security, effectively dismantling the SEC’s argument that crypto tokens inherently qualify as securities.
Brad Garlinghouse hailed the ruling as a victory for the entire crypto market, expressing hope that it would be a turning point for Congress to establish clear regulations for the industry. The court also found that Ripple’s XRP sales on exchanges, sales by company executives, and distributions to developers, charities, and employees were not securities.
This decision carries profound implications for the classification of digital tokens in the U.S. going forward, as stated by Ripple’s Chief Legal Officer, Stu Alderoty. He emphasized that the ruling could be used by others facing the SEC’s scrutiny, making it harder for the agency to boast about its crypto enforcement record.
Despite this triumph, Ripple’s pursuit of sound crypto regulation in the U.S. is far from over. The company plans to continue investing in jurisdictions with clear regulatory frameworks. In recent developments, Ripple was granted an In-Principle Approval for a Major Payments Institution License by the Monetary Authority of Singapore.
Additionally, the court order further clarified that only certain contractual sales to institutional investors would be subject to further proceedings, while everything else has been settled as a matter of law.
Following the court’s decision, several U.S. exchanges, including Coinbase, Kraken, Gemini, and Bitstamp, have either relisted XRP or announced plans to do so.
Furthermore, XRP remains listed on numerous exchanges globally. Notably, foreign regulators in Japan, Switzerland, the UAE, and the U.K. had previously determined that XRP was not a security.
With this landmark ruling in their favor, Ripple and the crypto industry can move forward with greater certainty and confidence, hoping for more conducive regulatory environments to foster growth and innovation in the rapidly expanding world of cryptocurrencies.
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