A classic scenario that goes beyond Ripple’s fate alone is the SEC lawsuit brought against the cryptocurrency company. The future of other cryptocurrencies may potentially change if XRP is classified as a security token. However, Ripple has recently defeated the SEC in a new battle in this trial full of turns and turns.
Is the XRP cryptocurrency issued by Ripple a digital asset?
It’s critical to comprehend what the SEC holds Ripple accountable for in order to comprehend this latest instance. The SEC has been suing Ripple Labs Inc. and two of its executives since December 2020. She accuses them of using “an unregistered digital asset securities offering” to raise $1.3 billion. In fact, the SEC claims that because of its centralization, Ripple (XRP) qualifies as a security token and must be registered with the stock market watchdog. The SEC eventually turned its action against Ripple into a template that other cryptocurrencies may follow. If it prevails, it would be simple to control other cryptocurrencies and treat them like stock market commodities.
A discussion of Ethereum that refutes the SEC’s allegations
But on Tuesday, Magistrate Sarah Netburn rejected the SEC’s plea to make a statement by the late agency chief William Hinman private. According to Hinman’s understanding of the current state of ether, the ethereum network, and its decentralized structure, current ether bids and sells are not securities transactions, with the exception of the fundraising that accompanied the launch of ether.
As a result, the Ethereum case may serve as a model for determining Ripple’s classification (XRP). The SEC argued that this remark was only Hinman’s personal position and did not represent its opinion. There is apparent hypocrisy. Because the SEC would not have tried to keep this information confidential if this position was truly harmless. Many experts concur that this verdict is a significant win for cryptocurrencies. We are rapidly drawing closer to the trial’s conclusion and a favorable result for Ripple. Then, ether (ETH) and bitcoin would have unquestionably attained the same status as ripple (XRP) (BTC).
The Ripple firm has been charged by the SEC since 2020, but it is getting closer to winning. The latter is probably unlikely to have much of an effect on Ripple’s pricing (XRP). But symbolically, it might attest to the independence of cryptocurrencies from the US stock market’s police force.
