Since the landmark ruling in the Ripple vs. Securities Exchange Commission (SEC) case, where the judge declared XRP tokens are not securities, attention has shifted to the regulator’s potential appeal of the decision. Notably, in a recent filing against Terraform Labs and its CEO Do Kwon, the SEC suggested the Ripple ruling was flawed and hinted at a possible appeal.
In this line, XRP holders attorney John Deaton has weighed in on the potential appeal of the Ripple ruling. In a tweet on July 23, Deaton emphasized that an appeal by the SEC would not spell disaster for XRP and XRPHolders.
Deaton’s optimism stems from the fact that any appeal process would be time-consuming, with a possible decision by the 2nd Circuit court not expected until two years from now.
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“An appeal is not even close to be a setback. First, it will be two years from now before a decision is issued by the 2nd Circuit if it’s appealed. The Torres Decision is the law until then – at least in the 2nd Circuit. Second, even if the 2nd Circuit said Torres was wrong regarding her application of the 3rd Howey factor (which I predict they won’t), that doesn’t meant the SEC wins on Programmatic sales (sales on exchanges),” he said.
Common enterprise ruling
Deaton argues that a 2nd Circuit fault with the 3rd Howey factor application wouldn’t ensure SEC’s victory in Programmatic sales. He noted that the judge may still rule similarly, weighing other factors, especially the common enterprise factor, which Deaton sees as a tougher criterion for the SEC to fulfill.
The attorney added that the recent victory for Ripple and XRP in the courtroom should not be underestimated in its significance for both the company and its XRP holders. He highlights the potential implications for the future, expressing confidence in the defense’s strength against the SEC’s allegations.
Notably, the cryptocurrency community has closely watched the legal battle between the SEC and Ripple, with the outcome expected to have far-reaching consequences for other digital assets that have faced similar regulatory scrutiny.
The decision, issued by Judge Analisa Torres, notably ruled that Ripple did not violate securities laws by offering its native token, XRP, to retail investors.
It is worth noting that in a recent legal submission, the SEC made fresh claims in its ongoing lawsuit against Terraform Labs, the firm behind the collapsed Terra (LUNA) ecosystem, and its co-founder, Do Kwon. The SEC asserted that the presiding judge had made errors in her ruling in a previous case involving Ripple.
In the meantime, XRP has rallied after the significant court ruling, with the token hitting new multi-month highs above $0.7 while targeting the crucial $1 position. By press time, XRP was trading at $0.74 with daily losses of about 5%.
