Ripple Labs has officially filed form C with the U.S. Court of Appeals for the Second Circuit, laying out the issues it intends to raise in its cross-appeal against the Securities and Exchange Commission (SEC). The ongoing dispute revolves around the classification and regulation of XRP.
Today, Ripple filed a Form C – listing the issues we plan to raise on our cross appeal. A few things to keep in mind as we move forward:
The case is not about whether XRP, in and of itself, is a security. XRP is uniquely situated as having clarity (alongside BTC) in not being… https://t.co/AmFocAnbPx
— Stuart Alderoty (@s_alderoty) October 25, 2024
From the appeal filed, XRP’s status remains unchallenged, as court has clarified it is not security, similar to Bitcoin. The SEC is not contesting this aspect and the filing makes it clear that no new evidence will be introduced.
As Ripple’s CLO, Stuart Alderoty posted on X, that they have a solid exiting proof from which the court will base its judgement. They do not wish to bring in anymore drama with introduction of new documents.
Ripple’s Core Legal Issues
Ripple’s Form C identifies four key issues to be addressed in the appeal:
- Investment Contract: Ripple questions the SEC’s application of the “investment contract” definition under the Securities Act of 1993.
- Howey Test: Ripple challenges the district court’s conclusion that some XRP transfers met the Howey Test requirements for an investment contract.
- Fair Notice Defense: Ripple argues widespread uncertainty surrounds federal securities laws applied to digital assets like XRP.
- Clarity on Injunction Orders: Ripple contests the vagueness of the injunction issued, lacking specific guidance.
Alderoty has also pointed out SEC’s strategy. The SEC has time and again created “distraction and confusion” around the Ripple and the larger crypto industry and the CLO assured that this is just a mere “background noise” as the company is set to grow regardless of how the appeal proceeds.
XRP Price Movement
Amidst this legal back-and-forth XRP’s price has seen fluctuations. Recently, XRP has experienced a price drop, mainly due to market reactions to the ongoing legal developments and broader uncertainties surrounding regulations in the crypto industry.
The SEC’s extension in filing its principal brief can potentially impact XRP’s pricing. This move may create uncertainty as prolonging the legal proceedings and delaying resolution may create a negative sentiments in the eyes of the investors.
At press time, the price of XRP token is $0.5251 with a drop of 0.1% in the last 24 hours. On the contrary, in the past hour there has been a surge of 0.5% in the price of XRP which indicates a optimistic sentiment amongst the investors. However, Team Ripple remains optimistic as assured by their CLO, that the business will grow and get better with each passing day.
Ripple’s upcoming cross-appeal will be closely watched as it may set a precedent for how cryptocurrency companies are regulated in the future.
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