Ripple Labs has recently filed an appeal in the ongoing lawsuit with the United States Securities and Exchange Commission (SEC). The appeal, known as Form C, was submitted on October 24. One of the main issues addressed in the appeal is the district court’s application of the Howey test to transfers of Ripple’s native token, XRP, which determines whether XRP should be classified as a security in institutional sales.
Ripple’s Chief Legal Officer, Stuart Alderoty, clarified that the case is not about whether XRP is a security or not, as it has already been established that XRP, along with Bitcoin, is not classified as a security. The SEC is not challenging this ruling. Alderoty also emphasized that Ripple believes the court decision did not consider the lack of fair notice given to Ripple regarding the SEC’s stance on federal industry laws. The SEC’s statements have been described as “inconsistent” and “deliberately vague.”
Alderoty further explained that the Court of Appeals will review the existing record and that the SEC cannot introduce new evidence or request additional documentation. He acknowledged the SEC’s strategy of creating distraction and confusion for Ripple and the industry but dismissed it as “background noise.” Alderoty expressed confidence in Ripple’s business, stating that it continues to grow and strengthen despite the ongoing legal process.
It should be noted that on October 17, the SEC filed a “Civil Appeal Pre-Pleading Statement” (Form C) in the U.S. District Court for the Southern District of New York. However, the court’s ruling that XRP is not a security remains unchanged. The SEC has recently appealed this ruling, which favored Ripple, regarding the classification of XRP as a security.
In a separate development, the SEC has requested an extension to finalize its main claim in the Ripple lawsuit. This extension, if granted, would push back the deadline to January 15, 2025. The request comes at a crucial time as Ripple is expected to submit its own Form C, detailing the points it intends to challenge on appeal.
Please note that the opinions expressed in this article are for informational purposes only and should not be considered as financial or investment advice. The decision to invest or trade cryptocurrencies carries a risk of financial loss.