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Ripple v. SEC case update as of May 8, 2023

Ripple v. SEC case update as of May 8, 2023

As the cryptocurrency industry eagerly awaits the court’s final decision in the ongoing legal standoff between the United States Securities and Exchange Commission (SEC) and blockchain company Ripple, a heated Twitter discussion has been happening behind the scenes while Ripple CEO has thanked the XRP community for its support.

Indeed, after Twitter user King Solomon posted a video of a conversation with Ripple CTO David Schwartz, it was retweeted by CadBan3, who argued that Schwartz was “admitting on video that [Automated Market Makers (AMMs)] are a communal effort with the reasonable expectation of profit – turning ‘market volatility into profit,’” and saying he was hoping to see Schwartz and SEC chair Gary Gensler debate on it.

Discussion heats up

However, another user, Mr.Huber, replied that the case wasn’t about the expectations of profit but about “applying the same rules to everyone and not [excluding] entire networks from regulations because they had funds and connections to bribe the SEC,” asking “what would be the point at all of registering with the SEC [if] the code is transparent and I decide to invest my assets in this mechanism.”

There was quite a bit of back-and-forth between various participants in the discussion, including a former SEC enforcement lawyer Marc Fagel. Ultimately, John E. Deaton joined in, a legal expert and Ripple amicus curiae who reiterated his earlier arguments and quoted the letter he wrote to Judge Analisa Torres, challenging the SEC’s argument, which he called “so farfetched, it travels through space and time, into the future, capturing all possible future sales, even in far-away lands.”

CEO and amici curiae address the XRP community

Meanwhile, Ripple CEO Brad Garlinghouse took part in the XRP Las Vegas 2023 event, where he expressed his gratitude and appreciation to the XRP community for their support during the legal battle against the regulator, as Finbold reported on May 6.

On top of that, the event has also welcomed other prominent figures from the lawsuit, including Deaton, the founder of CryptoLaw and a popular commenter on the SEC case, who has argued that recent developments had weakened the SEC’s position, including a legal document that acknowledges that the purchase of XRP was an investment of money into a common enterprise. 

Asked during the XRP event what needed to change at the SEC, Deaton said that “Congress needs to pass a law that stops the revolving [door] at the SEC. If you work at the SEC, you’re not allowed to go work for a company you were just responsible for regulating for a minimum of 3 yrs.”

“The same prohibition should apply to all regulatory agencies (FDA, EPA, CFTC, FinCEN, Treasury, etc). Second, we need to actually investigate and prosecute those who violate criminal financial conflict laws. Right now, there is no deterrent b/c there is no enforcement,” he added.

As things stand, the XRP token – a crypto asset at the center of the lawsuit – is currently changing hands at the price of $0.44, recording a decline of 5.34% on the day, as well as 7.99% over the previous week, adding up to the cumulative losses of 15.35% on its monthly chart, as per the latest data retrieved on May 8.

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