Ripple and the SEC have opposed each other’s motions for summary judgment, in the latest development in the litigation.
Earlier, Ripple and the Securities and Exchange Commission filed motions for summary judgment. If approved, the judge will decide the case, preventing the need to go to trial.
However, last Friday, both parties filed separate motions to oppose the issuance of the other’s decision. The SEC said Ripple’s motion should be dismissed because of “irrefutable evidence” that it improperly bought unregistered securities. The federal prosecutor launched an investigation against the company in December 2020 on this matter. Meanwhile, Ripple said the SEC has no legal basis to force Ripple to register XRP as a security.
Key articles found last week
Before this, Ripple showed in the disclosure of some documents that it was requested six times in the past. These are the SEC’s comments on the so-called Hinman documents. According to the report, they will present the SEC’s comments on the speech of the former Director of the Corporate Finance Division, William Hinman.
In a statement, Hinman said that while he previously thought of Ethereum as a security, his later knowledge of blockchain-based transactions led him to believe that “offers and purchases current of Ether is not a safe trade.”
Ripple sought to release these notes, believing they show the SEC’s understanding of Hinman’s claim that Ethereum is not a security. By using a similar concept, Ripple believes they can strengthen their case that XRP should not be considered a security.
There may not be enough documentation
Despite the rise of Ripple, a legal expert says that the opinion of a former SEC official is unreasonable. He argues that the ultimate decision rests with the Supreme Court, which has upheld the standard Howey test.
According to this standard, a security is defined as “an investment in a common entity with a reasonable expectation of profit from the actions of others.” Using this definition, SEC Chairman Gary Gensler believes that most cryptocurrencies can be considered securities. One exception is Bitcoin, which he said would be classified as a commodity.
However, according to another analysis, many XRP holders issued affidavits explaining that this was not the intent behind their purchases. According to Exhibit 167 of Ripple’s motion to dismiss the SEC, those who bought XRP, “for investment purposes, did not expect to receive profits from Ripple, but from the movements market and other sources.”
Longtime employees leave
Although unrelated to the lawsuit, it is worth noting that the leader behind the XRP ledger announced his resignation. Although it is not said what he did next, Nik Bougalis said He doesn’t always work in blockchain and crypto. This is the latest sign among crypto owners who have stepped down from their companies.
Last week, Ethereum and Polkadot co-founder Gavin Wood announced that he would be stepping down as head of Parity Technologies. A week earlier, the press revealed that Gemini founders Cameron and Tyler Winklevoss had left their positions as directors of the board of Gemini Europe. Meanwhile, the chief executives of cryptocurrency exchange Kraken and the Celsius Network resigned at the end of September.
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