What was celebrated as a great success by Ripple management and the XRP community alike could now turn into a bitter disappointment. Until now, it seemed unlikely that the SEC would contest the lenient verdict against Ripple and appeal. But now the company’s lawyers have requested that the fine of 125 million US dollars be transferred to an escrow account for the time being. This indicates that Ripple is preparing for the lengthy legal dispute to continue. How likely an SEC appeal now is according to experts. And: Why the XRP price could be affected as a result.
Ripple Labs probably popped the corks too early
The team of lawyers who have defended Ripple Labs since December 2020 against a lawsuit by the US Securities and Exchange Commission (SEC) want to suspend payment of the $125 million fine. The Ripple lawyers’ proposal: The company behind the XRP token should pay 111 percent of the judgment amount, i.e. around $139 million, into a bank account within 30 days “after the expiration of the appeal period or the conclusion of any appeal.” This is according to an application filed on September 4 with the US District Court for the Southern District of New York. What is particularly explosive is that the SEC itself is said to have already approved the proposal.
This could indicate that the SEC is seeking to challenge Judge Torres’ ruling, or at least is still uncertain about this landmark decision. If the SEC does not appeal, the funds will be released after the deadline. This is a kind of “insurance.”
As BTC-ECHO reported, Ripple management celebrated the imposed fine of 125 million US dollars as a major victory in the legal battle with the SEC. Originally, Gary Gensler’s agency had demanded a total fine of around two billion US dollars.
The likelihood of an SEC appeal
At the time of writing, the responsible US federal judge Torres has not yet signed the motion. If the SEC appeals the ruling, the process, which has been going on for almost four years, would face a new round. “I think that makes it more likely that the SEC will appeal,” commented Pro-XRP attorney James A. Murphy on the recent events. And continued: “If the SEC had already decided not to appeal, they would simply say, ‘No, go ahead and pay.'”
Fred Rispoli, another pro-XRP lawyer, comes to a similar conclusion, putting the chances of an SEC appeal at 60 percent. In a new X-Post he explains the reason for his assessment: “Putting this amount of money into a trust fund is not common practice unless the SEC evades Ripple’s lawyers when it comes to the issue of appeal.” He also calms immediate fears within the XRP community about the legal dispute. In his estimation, the case will probably not be finally decided before 2026.
Why dark clouds are hovering over the future of the XRP token
On the crypto market, however, the joy over Ripple’s success in court at the beginning of August has long since faded. The XRP token is currently trading at 0.538 US dollars, a price drop of 4.59 percent compared to the previous week. The long-term performance is even worse: Since the beginning of the year, the XRP price has lost 14.56 percent. In relation to the leading crypto currency Bitcoin, the Ripple token even fell by 32.6 percent.
Even if the trial ends well for Ripple, it is unclear whether the XRP price can be positively influenced in the long term. In addition, the company Ripple Labs could be successful in the long term without XRP adoption and instead raise fresh capital through an IPO, for example. It remains uncertain whether the Ripple token will ever be able to repeat the bull run of 2017/18. But difficult times are also likely to come for other altcoins. You can find out more here: “Get out of the portfolio: sell these 10 altcoins now before it’s too late”
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