After 3 years of legal battle with the SEC, the Ripple company was exonerated on July 13 from most of the charges against it. Contrary to accusations by the Security and Exchange Commission, the court found that programmatic sales of Ripple and other distributions of the XRP token are not considered investment contracts. A decision that delighted Chris Larsen and Brad Garlinghouse, the leaders of Ripple, but also everyone in crypto. As evidence, Paul Grewal, Coinbase’s chief legal officer, was quick to express relief. For him, the crypto industry is ready to put the legal troubles behind it and focus on innovation. He states that even that “the winter that crypto is going through is ready to melt”. Explanations.
Return to innovation, the DNA of cryptos
It was during an interview given to the American channel CNBC that the legal director of Coinbase was able to deliver his vision of the future of cryptos after Ripple’s victory against the SEC. “We see green shoots…the people are eager to focus again on innovation and new ideas, new technologies rather than hear from lawyers and judges in court cases,” said Paul Grewal.
Shortly after Thursday’s decision, Coinbase, along with Crypto.com and Kraken Pro, have reopened XRP trading (the crypto operated by Ripple). And the value of this last literally jumped during the day, reaching increases of more than 80% amid massive trading volume.
The Coinbase company completed this cry of joy by tweeting on Friday “Yesterday’s decision on XRP is a big win for the crypto industry”. If we can understand the satisfaction of the crypto giant, also entangled in a legal conflict with the SEC, we can wonder about all these announcements. New horizons or an attempt at a self-fulfilling prophecy? Because Ripple’s disputes with the SEC are not quite over.
A story not quite finished…
It should indeed be emphasized that this victory only partially resolves Ripple’s legal issues with the Security and Exchange Commission. Indeed, although the court rejected the idea that programmatic sales were investment contracts, it concluded that the sale of 728.9 million XRP by Ripple to institutions constituted an unregistered offer and sale of investment contracts. Therefore, it violates the Section 5 of the Securities Act.
However, Ripple is sticking firmly to its position and focusing on the positive aspects of this lawsuit. In this regard, Brad Garlinghouse said: “In 2020, we said we were on the right side of the law, and we will be on the right side of history. We are grateful to everyone who contributed to today’s decision. This decision is in favor of crypto innovation in the United States”.
Crypto winter doesn’t seem quite over…
Sources: Theblock, Blockchair, CNBC