The U.S. Securities and Exchange Commission (SEC) is rapidly approaching a crucial deadline that could have lasting effects on the cryptocurrency industry. By October 7, the SEC must decide whether to appeal the recent ruling in its case against Ripple, a decision that could reshape crypto regulations across the United States.
Pro-XRP attorney Fred Rispoli, founder of HODL Law, sees the likelihood of an appeal as high. He shared his insights on social media platform X, estimating a 60/40 chance that the SEC will file a notice of appeal. “The stakes are incredibly high for the SEC,” he noted. If the agency allows the ruling to stand, it would limit the decision’s scope to Ripple’s secondary market sales only. An appeal, on the other hand, could open the door for a broader impact on how digital assets are treated under U.S. law.
Since the ruling was issued by the U.S. District Court for the Southern District of New York on August 7, 2024, discussions have been intense within the legal and cryptocurrency communities. The ruling was seen as a partial victory for Ripple, with the court deciding that XRP sales on the secondary market did not constitute securities transactions. However, the decision still left certain aspects open for interpretation, particularly regarding institutional sales.
Rispoli also pointed out that the SEC could win the appeal if the case is assigned to a panel of judges who are more sympathetic to its cause. The outcome, he stressed, would heavily depend on the random selection of the three judges.
Other legal experts, such as John Deaton, another pro-XRP lawyer, argue that the SEC should focus its resources on stronger cases that could more definitively shape the regulatory landscape. However, a former SEC attorney has hinted that the agency may see the ruling as flawed and worth contesting. This ex-SEC lawyer believes the court’s reasoning was weak, making an appeal more likely.
The stakes of the SEC’s decision are immense. If the agency appeals and wins, it could set a precedent that would complicate the regulatory environment for other digital assets, broadening the definition of what constitutes an “investment contract.” A loss, however, would solidify Ripple’s victory and make it harder for the SEC to pursue similar cases in the future.
Jeremy Hogan, another attorney following the case, criticized the SEC’s strategy, noting that the agency seems more focused on winning cases than protecting investors, which should be its primary mandate. “They’ve lost their way,” he said.
As the October 7 deadline looms, the crypto world is on edge, waiting to see how the SEC will proceed. This decision could mark a turning point for how digital assets are regulated in the U.S. and beyond.
Disclaimer:
FOMODigest strives to provide accurate and impartial reporting. The information in this article is for informational purposes only and should not be considered financial or legal advice. Due to the dynamic nature of the market, we encourage readers to conduct their own research and consult professionals before making any financial decisions.
