As a long-term crypto investor with experience in the market, I’m closely monitoring the ongoing legal battles between Ripple Labs and the SEC. The recent ruling by Judge Phyllis Hamilton that the civil securities litigation against Ripple will proceed to trial is a concerning development for XRP investors.
A California judge, Phyllis Hamilton, has decided against dismissing the civil securities lawsuit against Ripple Labs Inc., allowing the case to proceed to trial. This decision has surprised the crypto community, as Ripple had attempted to have the case thrown out. The lawsuit accuses Ripple’s CEO, Brad Garlinghouse, of breaking California securities laws in 2017.
As a crypto investor, I’ve noticed that XRP‘s price has taken a hit lately. According to CoinMarketCap, the XRP price has dropped nearly 9% over the past month and lost over 1% of its value since June 2023. Despite some promising bullish signals, XRP hasn’t managed to sustain an upward trend. The current price is a staggering 87.26% lower than its all-time high of around $3.8, which was reached back in January 2018.
A ongoing lawsuit alleges that Garlinghouse made misrepresentations during a 2017 televised interview concerning Ripple’s XRP sale. Specifically, the plaintiff asserts that Garlinghouse stated he held large amounts of XRP while simultaneously selling massive quantities on cryptocurrency platforms. This action, according to the plaintiff, is a breach of California’s securities regulations.
In the class action lawsuit, Judge Hamilton rejected four out of the five complaints, referring to them as “failure to register claims.” Nonetheless, the accusation against Garlinghouse for supposedly making misleading statements is allowed to move forward and face a trial.
In her decision, Judge Hamilton explained that it was impossible for the court to identify if a rational investor would have anticipated profits solely based on the broader trends of the cryptocurrency market, rather than Ripple’s initiatives to simplify XRP transactions for cross-border payments and other related activities.
Ripple Continues to Battle Legal Issues
Ripple’s lawyers requested that Judge Hamilton dismiss the claims against XRP as it doesn’t meet the criteria of a security under the Howey Test. They emphasized the ruling of US District Court Judge Analisa Torres, who decided that XRP didn’t fulfill all requirements of the Howey Test when sold directly to regular investors on cryptocurrency trading platforms.
In the Southern District of New York, Judge Torres’ decision was viewed as a step forward and a partial triumph for Ripple. This judgment could serve as a precedent for future cryptocurrency cases, bringing welcomed clarity to the industry. The crypto community celebrated this development as a significant stride towards regulatory certainty.
As a crypto investor, I’ve noticed that the market for XRP hasn’t shown much excitement despite the recent court ruling by Judge Torres. However, there are rumors circulating about the potential launch of an XRP exchange-traded fund (ETF). This development could potentially give XRP prices a significant boost if it comes to fruition. Nevertheless, I can’t help but feel apprehensive about the SEC’s stance on approving such a product.
I’d note that Stu Alderoty, Ripple’s Chief Legal Officer, expressed satisfaction with the dismissal of the class action claims in the ongoing lawsuit. However, he acknowledged the necessity of addressing the surviving state law claim during the trial. In his own words, “We are pleased that the California court dismissed all class action claims. The one individual state law claim that survived will be dealt with at trial.”
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2024-06-21 10:51