Ripple SEC Settlement: 500M XRP Unlocked Amid Remedies Ruling Odds

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As a seasoned observer of the ever-evolving world of cryptocurrencies and blockchain technology, I must say that the recent events surrounding Ripple and its ongoing battle with the SEC have been nothing short of intriguing. Having closely followed this saga since its inception, I can’t help but feel a sense of deja vu with the latest rumors of a possible settlement.

As a financial analyst, I’ve noticed a resurgence of Ripple SEC settlement speculation, following the substantial release of XRP tokens from escrow. A staggering 500 million XRP, equating to around $297.74 million, were unlocked, triggering an 8% dip in XRP’s value. Furthermore, this action broke through the crucial $0.6 psychological support level, a potential risk I had flagged earlier via Coingape.

Lawyers Weigh In On Ripple SEC Settlement

The large unlock has fueled speculation about a possible settlement in the ongoing legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC). The SEC has sought a substantial $1 billion (plus interest) penalty from Ripple for alleged violations. Whilst, the blockchain firm has indicated it is willing to settle for no more than $10 million.

Last week, attorney Bill Morgan who supports Ripple, mentioned that a potential settlement between Ripple and the SEC is considered “unusual.” Yet, if it happens, it would be more about reaching an agreement rather than a substantial win for either side. Morgan clarified, “Settlements usually put an end to disputes, including the right to appeal in the current case.” However, he noted that Ripple could encounter issues concerning XRP sales not just before December 2020 but also any future sales.

Furthermore, former SEC attorney Marc Fagel has reiterated his position that the SEC’s private meetings have no connection to the ongoing legal battle. He additionally speculated that a settlement between Ripple and the SEC is highly improbable, as neither party will choose to compromise. Moreover, he anticipates appeals from both sides following the verdict. Furthermore, Fagel emphasized that the substantial fine imposed by the SEC might not be enforced, suggesting leniency for the blockchain company.

Appeals After Remedies Ruling

The lock’s release lines up neatly with increased excitement about a decision in the Ripple lawsuit regarding remedies, which was initially slated for July 31st but is now thought to come as early as August, potentially even within its initial phase.

Financial consultant Mickle, along with others, finds the Securities and Exchange Commission’s case against Ripple to be relatively weak, pointing out the company’s past legal successes. However, it’s worth noting that both parties have the possibility of appealing earlier rulings, which could make resolving this case more convoluted.

Mickle further pointed out that the political environment, particularly the Democrats’ growing support for cryptocurrencies, could impact the possibility of an appeal. He added that the blockchain payments company seems unwilling to appeal following the decision in the remedies phase. This statement arises amidst Kamala Harris’s campaign efforts to redefine the narrative surrounding cryptocurrencies.

In my perspective as a researcher, I would counter by stating: If the decision to appeal hinges solely on legal factors, it’s reasonable to anticipate appeals from both sides. To clarify, I’m suggesting that if a decision is based purely on legal considerations, there’s a strong possibility that an appeal will be made.

In my analysis, Morgan outlined some possible legal approaches that Ripple could pursue. He suggested that the company may focus on differences between sales to institutional clients and those to On-Demand Liquidity (ODL) customers. He emphasized the importance of the fact-specific nature of the Howey test in this context.

In addition, Morgan clarified the reasoning behind the Securities and Exchange Commission’s potential decision to file an appeal. The attorney pointed out that this action suggests the SEC believes there may have been an error in the judgment, and they have identified reasonable grounds for appealing, as evidenced by their request for permission to file an interlocutory appeal, a fact which some appear to have overlooked.

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2024-08-02 11:06