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SEC Files Appeal Brief as XRP Hits Record High
Crypto Enforcement | Jan 17, 2025
Image: Freepik/wayhomestudio
SEC Appeals Ripple's XRP Classification As XRP Price Touches All Time High
With just a handful of days remaining in Gary Gensler's job as Chair of the U.S. Securities Commission (SEC), the legal saga between SEC vs Ripple Labs over the classification of XRP continues. On January 15, the SEC filed an appeal to try and overturn the 2023 ruling that XRP is not a security when sold to retail investors. The appeal reopens the debate whether XRP sales to retail investors meets the criteria for investment contracts under the Howey Test, arguing that XRP investors expected profits from Ripple's efforts.
See: Trump Picks SEC Chair, Shakes Up Crypto and Oversight
Stuart Alderoty, Ripple’s Chief Legal Officer:
As expected, the SEC’s appeal brief is a rehash of already failed arguments –and likely to be abandoned by the next administration. We’ll respond formally in due time. For now, know this: the SEC’s lawsuit is just noise. A new era of pro-innovation regulation is coming, and… https://t.co/3ZxO64Fs8C
— Stuart Alderoty (@s_alderoty) January 16, 2025
Market Reaction
The market's response to the idea that the 'SEC's appeal brief is simply a rehash of already failed arguments', pushed XRP's price upwards to $3.38, just shy of it's all time high price of $3.40, reached on Jan 6, 2018 per Coingecko. Analysts and traders are quite optimistic around the potential outcome of the legal case, and are speculating about XRP exchange-traded-funds and the coin being included in national bitcoin/crypto reserves that would further boost demand for XRP. On social media, reactions were mixed with memes and commentary with many seeing the SEC's appeal as redundant while others remained cautious.
Brad Garlinghouse, Ripple CEO on X here:
"If Gensler and the SEC were rational, they would have moved on from this case long ago. It certainly hasn't protected investors and instead has damaged the credibility and reputation of the SEC."
See: Gensler’s Final Salvo as SEC Targets Unicoin in Crypto Clash
Paul Atkins, Appointed SEC chair and Former SEC Commissioner on FT:
"The SEC's approach to digital assets needs a comprehensive reevaluation to foster innovation while ensuring investor protection."
Why It Matters
The SEC’s appeal and subsequent XRP price jump highlight the importance of this case for the future of crypto. If Ripple wins, it could set a global standard for how digital assets are classified, providing more regulatory clarity and freedom to innovate.
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