Thomas Daniels
The recent Ripple v. SEC ruling has sent shockwaves through the crypto markets, resulting in a significant price surge for XRP. However, AMLBot CEO Slava Demchuk cautions that an appeal by the SEC could disrupt this positive momentum.
Last year, Ripple’s initial victory over the SEC provided a substantial lift to crypto markets, reinforcing the sentiment that retail crypto investments are not securities. This sentiment buoyed the prices across the nascent industry. The final ruling on August 7 by U.S. federal judge Analissa Torres continued this trend, positively affecting XRP’s market standing.
As of the latest reports, Ripple’s XRP remains up by 23%, following Judge Torres’ decision that there were no federal securities violations in sales to retail investors through crypto exchanges. Nevertheless, institutional sales of XRP were found to be in violation, leading to a $125 million penalty imposed by the SEC on Ripple.
“If the SEC pursues the case into appeal, I think the price will drop. If not, we might see it rising,” AMLBot CEO Slava Demchuk shared with crypto.news on August 8.
Ripple and its CEO Brad Garlinghouse have hailed the verdict as a significant win. However, Demchuk anticipates that the SEC will likely appeal the decision. This ongoing legal battle, now extending over four years, could introduce further uncertainty for Ripple’s cryptocurrency, which some critics argue functions similarly to a quasi-stock.
Implications for Future SEC v. Crypto Cases
Judge Torres’ verdict was delivered approximately four months before the presidential elections in November. Some speculate that a new administration might change the SEC’s approach to cryptocurrency regulation. Contrary to this belief, Demchuk asserts that the election outcome will not “considerably change the SEC’s approach.”
Nonetheless, the court’s decision regarding XRP provides a critical precedent for the digital asset industry. It challenges the SEC’s stance that most cryptocurrencies are securities. According to Demchuk, “Based on the current case, selling tokens via crypto exchanges rather than directly might mitigate the risk of the token being classified as security.”
Crypto businesses under scrutiny, such as Uniswap Labs and ConsenSys (the maker of MetaMask), may leverage this precedent in their respective legal battles against the SEC.
