SEC Moves to Appeal Ripple Ruling That XRP Token Is Not a Security
(Bloomberg) -- The Securities and Exchange Commission asked a federal judge for permission to appeal her ruling that Ripple Labs’ XRP token is not a security when sold to the general public, arguing that the decision could affect other cases involving cryptocurrencies.
Most Read from Bloomberg
China Evergrande Group Files Chapter 15 Bankruptcy in New York
Vietnam Tycoon Loses $18 Billion After EV Maker’s Shares Sink
Bitcoin Calm Shatters With Sudden Tumble, Mass Liquidations
‘Poor Man’s Cocaine’ Costing $3 a Pill Threatens to Proliferate
Big Tech Logs Year’s Longest Weekly Losing Streak: Markets Wrap
The SEC in court papers Friday requested that US District Judge Analisa Torres in Manhattan certify the issue for immediate appeal. The SEC needs permission because Torres’s ruling was on a preliminary motion rather a final judgment, but the regulator said the matter was too important to wait because “the ultimate answer to these questions could affect a number of pending cases involving crypto assets.”
Torres in July found that the cryptocurrency was covered by securities law only when sold to sophisticated institutional investors, a ruling hailed as a major victory for the industry. The SEC has several major cases against cryptocurrency exchanges and issuers, accusing them of offering unregistered securities.
Another Manhattan federal judge, overseeing the SEC’s case against Terraform Labs and its founder Do Kwon, explicitly rejected Torres’s approach in a July 31 decision. US District Judge Jed Rakoff said Terra USD token may indeed be a security when sold to retail investors.
XRP was down around 11% on Friday, trading around 51 cents. Though the token soared to a high of 94 cents after Torres’s July 13 ruling, it’s largely shed those gains in the month since.
Ripple is opposed to allowing the SEC to immediately appeal the Torres’s ruling, saying in court filing that there is “no extraordinary circumstance” requiring the issue to be resolved before the matter goes to trial.
The case is SEC v. Ripple Labs Inc., 20-cv-10832, US District Court, Southern District of New York.
--With assistance from Dave Liedtka.
(Updates with price trends, background.)
Most Read from Bloomberg Businessweek
GOP Presidential Hopeful Ramaswamy Sued Over Strive’s Practices
‘Don’t You Remember Me?’ The Crypto Hell on the Other Side of a Spam Text
The Legendary, Wildly Profitable QQQ Fund Makes No Money for Its Owner
Brookfield Chases Rivals for Private Equity’s New Money-Spinner
Sam’s Club’s War Against Costco Started With $1.38 Hot Dog Combo
©2023 Bloomberg L.P.
