Ripple SEC Lawsuit finally end. The Ripple-backed XRP cryptocurrency saw its value catapult upwards by a spectacular 96% in just one day! This jaw-dropping surge in price came on the heels of a monument-shifting legal win for Ripple Labs in their heated court battle in the Ripple SEC Lawsuit. XRP climbed from $0.56 to over $1.10, reaching highs not seen since March 2022.
Judge Sarah Netburn of the Southern District of New York’s U.S. District Court ruled on Tuesday, that XRP transactions on digital asset exchanges did not qualify as investment contracts, the price of XRP has since skyrocketed. This ruling deals a crushing blow to the SEC in its long-running lawsuit against Ripple Labs, filed in December 2020.
The SEC had alleged that Ripple Labs violated federal securities laws by selling XRP as an unregistered security. However, Judge Netburn stated that the SEC had failed to prove its case that XRP qualified as a security under the Howey test, the legal framework used to determine whether a transaction constitutes an investment contract.
In her judgment in Ripple SEC Lawsuit, Judge Netburn added that “The SEC has not met its burden of establishing that XRP transactions constitute investment contracts.” The evidence in front of the court indicates that XRP holders are probably driven more by a desire to use XRP for its intended functionality than by an interest in making investments.”
Judge Netburn’s ruling is a huge victory for Ripple in Ripple SEC Lawsuit. The ruling severely undermines the foundation of the SEC’s case. Legal experts say it will be very difficult for the SEC to prevail at trial without this critical Howey test determination.
“Today’s ruling is a critical development in the crypto space, paving the way for a differentiation between cryptocurrencies and securities,” said Stuart Alderoty, General Counsel for Ripple Labs. “Though there is more work ahead, we are pleased the court has found what we proved from the start – that XRP is a currency.”
The stunning price surge reflects renewed optimism that Ripple XRP will ultimately prevail against the SEC after this latest ruling. The Ripple SEC lawsuit had cast a long shadow over the asset’s price.
But with the tide seemingly turning in Ripple’s favor, the market is betting that XRP has tremendous upside ahead. Ripple also scored two other legal victories last week after Magistrate Judge Sarah Netburn granted Ripple access to the SEC’s internal documents regarding bitcoin, ether, and XRP.
“This will prove to be a huge development in validating that XRP is not a security and further separate it from its inferior crypto counterparts,” said crypto analyst Brian Brooks on this breakthrough news on Ripple SEC Lawsuit.
However, some caution that the price spike may be overdone and could retrace. The SEC still has avenues to appeal the ruling. But the latest ruling no doubt tilts the scales significantly in Ripple’s favor.
“While the recent XRP price action may be exaggerated and could see profit-taking, the long-term picture is decisively bullish,” said David Schwartz, Ripple CTO. “We’ve always argued XRP is a currency, and this ruling validates that stance.”
The ruling already has wider implications beyond just Ripple and XRP. Legal experts say it could rein in the SEC’s aggressive approach toward regulating cryptocurrencies through enforcement actions rather than formal guidance. Other crypto firms embroiled in lawsuits with the SEC, like blockchain company LBRY, are also hoping to benefit.
Former head of the CFTC, Chris Giancarlo, says this should be an alarm bell for the SEC. He added that “The SEC can no longer just make rules without proof. They need facts and reason to regulate cryptocurrencies. This could lead to sensible and fair crypto regulations based on basic principles.”
The XRP price explosion has also lifted it back into the top 5 cryptocurrencies by market capitalization, surpassing stablecoin USDC and meme token Dogecoin. XRP now has a market cap of about $40 billion, quadrupling in just the past month. The Ripple community on social media is ecstatic, calling the ruling “vindication” after years of FUD (fear, uncertainty and doubt) surrounding XRP’s legal status.
But can XRP maintain its meteoric price rise? Market observers are split. Some think the parabolic move is unsustainable without matching fundamental adoption. “XRP is way overheated, this is a classic speculative frenzy based on hype rather than actual utility,” warns crypto skeptic Nouriel Roubini.
Others counter that the token has been massively undervalued for years, and the recent pump merely brings XRP closer to its fair value. “The markets are simply pricing in the explosive growth potential for Ripple and XRP that has long been suppressed by SEC overhang,” notes industry analyst Willie Wu.
Despite the latest price euphoria, Ripple Labs emphasizes that they remain focused on the long-term. Brad Garlinghouse, the CEO of Ripple, stated, “We were certain that legally XRP would be viewed as a currency. But technology moves faster than rules and laws. Our vision is to enable an internet of value – a world where money moves as information does today.”
With the favorable ruling boosting Ripple’s legal clarity, and the coming wave of CBDCs providing fertile ground for cross-border payments innovation, hopes are rising that XRP’s best days lie ahead. But risks remain if the SEC continues its crackdown against crypto.
Disclaimer: This post is intended solely for informational purposes and should not be taken as legal, tax, investment, financial, or any other form of advice. Although all the information provided is true to the best of our knowledge, it is advisable to research well before making any kind of investments or decisions in general. The team of ReadingCrypto bears no responsibility in the event of any adverse outcomes.
