US SEC to Appeal XRP Secondary Sales In Ripple Lawsuit, Says Ex-SEC

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As a seasoned crypto investor with a decade of market experience under my belt, I find myself both intrigued and concerned by the latest developments in the Ripple XRP case. Having witnessed the ebb and flow of numerous regulatory battles, I’ve learned to expect the unexpected.

Marc Fagel, a former official at the U.S. Securities and Exchange Commission (SEC), has hinted that the SEC could challenge the court’s decision about the resale of XRP. This comes after a significant verdict that deemed the initial sales of XRP were not classified as securities. Notably, Fagel pointed out that the Ripple case did not cover secondary market transactions, and it seems the SEC is now considering focusing on these transactions instead.

Ex-SEC Marc Fagel Predicts SEC Appeal in Ripple XRP Case

Based on Marc Fagel’s statements, it seems likely that the Securities and Exchange Commission (SEC) may challenge the decision regarding the secondary market transactions of XRP. Fagel highlighted that the previous court ruling in favor of Ripple did not cover these sales, leaving an opportunity for the SEC to reconsider this matter.

The former SEC official emphasized,

What I’m trying to convey is that the Ripple decision doesn’t necessarily prevent them from filing a lawsuit against another company for selling XRP as a security.

Fagel’s analysis offers insights into possible upcoming moves by the SEC, as they continue to closely monitor and define what falls under their regulatory purview.

In response, attorney Bill Morgan challenged the reasoning for categorizing Binomial XRP futures as security futures agreements. He highlighted the discrepancies in regulatory application, particularly when considering XRP’s relationship with Ethereum (ETH). Previously, the SEC had not expressed any objections to futures contracts involving ETH, a fact that Morgan found notable and inconsistent in enforcement.

Morgan expressed frustrations, stating,

As a researcher, I find it challenging to accept such seemingly capricious regulations. It’s no surprise that the cryptocurrency market exhibits a strong bias towards Bitcoin and Ethereum due to this inconsistency.

Legal Challenges and Industry Reactions

Furthermore, the CEO of Ripple, Brad Garlinghouse, has spoken out against the Securities and Exchange Commission (SEC) for consistently asserting that XRP is a security, despite court decisions indicating otherwise. His criticisms highlight a widespread industry discontent towards what is perceived as unpredictable and excessively strict regulatory actions.

After the SEC appeared to overlook a court ruling in their legal dispute with the cryptocurrency derivatives exchange Bitnomial, Garlinghouse made comments. He indicated that Ripple would actively monitor the situation and take steps to ensure the SEC is held responsible for its actions.

Additionally, the Bitnomial case has sparked much debate. The exchange contends that XRP futures fall under the jurisdiction of the Commodity Futures Trading Commission (CFTC), rather than the Securities and Exchange Commission (SEC). Simultaneously, the exchange maintains that XRP does not meet the criteria for a security and is therefore exempt from stringent securities regulations.

These advancements take place concurrently with Ripple’s cross-appeal in their ongoing legal dispute with the U.S. Securities and Exchange Commission (SEC). This strategic legal maneuver by Ripple intends to clarify questions left unanswered beyond the initial decision that XRP is not classified as a security. More specifically, the cross-appeal aims to discuss the far-reaching effects of the SEC’s assertions regarding XRP transactions on multiple exchanges and other distributions, which the SEC had previously attempted to contest.

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2024-10-12 16:30