The legal dispute between Ripple and the SEC regarding XRP continues to generate interest in the cryptocurrency community. Both parties have filed their respective summary briefings and the outcome remains uncertain. Legal experts are speculating on the potential impact of the case on the cryptocurrency industry.
John Deaton, founder of Crypto Law, recently weighed in on the Ripple vs SEC case, pointing out the SEC’s inconsistent stance on what constitutes a common enterprise. He thinks the judge could reject a summary judgement, as a common enterprise is a key factor in determining if a financial instrument is a security or not.
Based on the SEC’s schizophrenic argument regarding what constitutes the common enterprise in the @Ripple case, there’s a possibility Judge Torres could deny summary judgment and rule that there is a genuine issue of material facts as to the existence of a common enterprise. https://t.co/3Vo9wGFRed
— John E Deaton (@JohnEDeaton1) January 30, 2023
A common enterprise is a crucial factor in determining whether a financial instrument is a security or not. Deaton had previously projected that the case might end in a settlement, with Ripple and the SEC avoiding further appeals even after the summary judgment.
Ripple asserts that the SEC is attempting to classify XRP as an investment contract, however, Ripple argues that there is no agreement, no privileges for investors, and no responsibilities for the issuer. The SEC, on the other hand, accuses Ripple of using ‘invented’ criteria that disregard established securities law in the US.
As the case awaits a judgment date, interested parties are seeking to influence the final decision. Ripple has filed a motion objecting to an investment banker declarant’s request to keep certain information confidential. The party submitted a reply, stating that revealing their identity could negatively impact future investigations.
Both Ripple and the SEC are confident of emerging victorious in the case. The crypto community is currently focusing on the court’s decisions regarding sealing certain documents from the public. The outcome of the case will not only impact Ripple and XRP, but will also set a precedent for the entire cryptocurrency industry. The SEC is suing Ripple for selling unregistered securities in the form of XRP tokens. Also Read