- The ongoing legal battle between the SEC and Ripple is coming to an end soon.
- Legal expert, Scott Chamberlain has shared five predictions about the case.
Since December 2020 when the United States Securities and Exchange Commission (SEC) first sued Ripple Labs Inc, many were unsure how the case is going to unfold. However, at this time when the case is almost concluded, a number of legal experts that have been observing the case are beginning to have a say on the direction in which the much-anticipated summary judgment will take.
One of the experts who has been following the case closely, Scott Chamberlain has given about 5 possible predictions as the case is now drawing to an end. Let us go over them one after the other;
1. Summary Judgement on Ripple Executives
Scott said he does not believe the SEC will find enough evidence to support the claims that both Ripple CEO Brad Garlinghouse and Chairman, Chris Larsen knowingly sold the XRP as unregistered securities.
When the SEC sued Ripple, it named both Garlinghouse and Larsen as defendants for piloting the firm to sell XRP as securities. With Scott’s prediction, both executives might finally be acquitted by the presiding judge.
2. Overseas Sale of XRP
According to the veteran legal practitioner, the sales of XRP overseas which is one of the basis in the lawsuit is untenable as the court does not have jurisdiction over such sales. Scott said for there to be headway in that regard, a whole new precedent will have to be set in a bid to argue that those transactions were completed in the United States.
This appears to be a long shot for the regulator
3. Claims that XRP itself is a Security
Part of the strong arguments of the SEC is that XRP in itself is security. For clarity, the case of Ripple is that the payment firm sold the asset as a security, however, the regulator also claimed that the coin is also a security.
According to Scott, “no precedent supports the digital asset itself being a security. This claim was a contrivance for the SEC not to have to prove each sale and to avoid the problem of overseas sales,” thus, showcasing another weak angle for the SEC.
4. Summary Judgment of Proceeds
In simple and plain terms, Scott believes “what proceeds is a limited case about whether any of Ripple’s sales of XRP in the US involved an unregistered investment contract.”
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5. The Summary of all Summary Judgments
In all, Scott said that based on the summary judgment on overseas sales and the dismissal of the part where the status of XRP as security is questioned, the regulator may have little to nothing to fall back to garner the victory. In his words;
“Because of 2 and 3, the case settles. I happen to believe the SEC underestimated that most of Ripple’s sales occurred on overseas exchanges through algorithmic trading. Once overseas and secondary market sales are excluded, there’s insufficient meat left on the bone.”
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