In a monumental win for the cryptocurrency industry, Ripple has emerged triumphant in its long-standing legal battle against the US Securities and Exchange Commission (SEC).
A huge win today – as a matter of law – XRP is not a security. Also a matter of law – sales on exchanges are not securities. Sales by executives are not securities. Other XRP distributions – to developers, to charities, to employees are not securities.
— Stuart Alderoty (@s_alderoty) July 13, 2023
US district judge Analisa Torres delivered a partial ruling, determining that Ripple did not violate federal securities law by selling the XRP token on public exchanges and through algorithmic trading.
This landmark decision sent shockwaves throughout the market, resulting in a remarkable 100% surge to the $0.95 area late on Thursday. However, the price has since recorded a reversal to the $0.77 price point.
A Look at the Ruling in Favor of Ripple
The SEC’s lawsuit, filed in 2020, accused Ripple, along with CEO Brad Garlinghouse and co-founder Christian Larsen, of conducting an unregistered and ongoing digital asset securities offering that raised over $1.3 billion.
While the judge did rule that the institutional sale of XRP constituted a violation of federal securities law, she made the crucial distinction that programmatic sales, facilitated through exchanges and algorithms, did not fall under the definition of securities. This conclusion was drawn from the judge’s assessment that buyers did not possess a definitive expectation of deriving profits from the entrepreneurial or managerial efforts of others.
The significance of this ruling cannot be overstated, not just for Ripple but for the entire cryptocurrency industry, especially in the United States.
Ripple’s CEO, Brad Garlinghouse, expressed his elation, emphasizing the broader implications for the industry as a whole. This favorable outcome could potentially establish a vital precedent and bring much-needed regulatory clarity to the treatment of cryptocurrencies.
We said in Dec 2020 that we were on the right side of the law, and will be on the right side of history. Thankful to everyone who helped us get to today’s decision – one that is for all crypto innovation in the US. More to come.
— Brad Garlinghouse (@bgarlinghouse) July 13, 2023
US Exchanges Rush to Relist XRP Following the Ruling
In response to the ruling, major cryptocurrency exchanges wasted no time reopening XRP trading. Coinbase, Crypto.com, and Kraken Pro were among the platforms that promptly restored XRP trading functionality.
W.
W for @ripple.
W for the industry.
W for the builders.
W for a clear rulebook.
W for updating the system.Oh, and XRP is now open for trading.
— Coinbase 🛡️ (@coinbase) July 13, 2023
The surge in trading volume added to the remarkable surge in the price of XRP to its highest point since December 2021.
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