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Ripple v. SEC court case update as of January 2, 2023

Ripple v. SEC court case update as of January 1, 2023

The cryptocurrency community is eagerly awaiting the ruling in the Ripple and Securities Exchange Commission (SEC) case that has entered its third year. 

As a recap, the regulator is accusing Ripple of selling unregistered securities in the form of XRP tokens raising over $1.3 billion. 

Currently, the community is awaiting the ruling date, with both parties having made final submissions. Ahead of the verdict, pro-XRP attorney John Deaton commissioned a poll asking the XRP community to share possible outcomes in the case. 

XRP community in favor of settlement

In the December 28 poll that attracted about 18,000 votes, a majority at 59.2%, believed the case would be settled between the two parties, while 40.8% opted for the verdict option. 

However, Deaton sided with the minority of the votes suggesting that the lawsuit would go to a verdict based on three main reasons. 

According to Deaton, he initially thought the SEC’s objection to releasing the Hinman emails was a hint for a settlement. However, the presiding judge overruled the SEC’s decision to seal the document where the regulator’s former official referred to Ethereum (ETH) as a security. 

At the same time, the lawyer suggested that SEC Chair Gary Gensler is ready to accept an unfavorable outcome in the lawsuit, considering that the Commodities Futures Trading Commission (CFTC) is seeking to have the overall oversight on cryptocurrencies

At the same time, the lawyer pointed out that the case could go into a final ruling, noting that following the collapse of FTX, the SEC’s stance on cryptocurrencies has potentially been validated. 

“In sum, unfortunately, I think a settlement w/Ripple is not in Gensler’s mindset. I don’t believe he’s going to settle and publicly agree that ongoing and future XRP sales, including in the secondary market, are non-securities. And Ripple won’t settle unless the SEC so agrees,” he said.

Uncertainty over the settlement date

Furthermore, defense attorney James Filan suggested that if the case does have an out-of-court settlement, a ruling will occur on or before March 31. In the meantime, both parties expect different outcomes from the lawsuit, with lawyer Jeremey Hogan projecting four possible scenarios in the ruling. 

Initially, Cardano (ADA) founder Charles Hoskinson claimed that the matter would be settled on December 15. After the date passed, Hoskinson became subject to attacks from the Ripple community, pushing him to resolve not to talk about the matter again. 

In the meantime, the court granted a motion for crypto investment firm Paradigm to join the case. However, the regulator is still receiving backlash after applying to seal documents in categories of names and identifying information of the SEC’s experts and XRP investor declarants, personal and financial information, and internal SEC documents reflecting debate and deliberation by SEC officials.

XRP price analysis

By press time, XRP was trading at $0.34, with gains of about 1.8% in the last 24 hours. Notably, the token is still attempting to break key resistance levels as it targets $0.40. 

XRP one-day price chart. Source: Finbold

Overall, the case outcome is expected to impact the prospects of XRP. For instance, if the matter is ruled in favor of the blockchain firm, it could be a bullish sentiment for XRP. At the same time, if the court determines XRP is a security, it could be a bearish sentiment for the asset. 

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

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