- XRP reaches a seven-year high above US$3 as potential ETF approval looms for 2025, bolstered by anticipated changes in SEC leadership with Gary Gensler’s departure.
- The SEC’s recent appeal against Ripple focuses narrowly on specific sales and distributions rather than XRP’s security status, which was already ruled not to be a security in 2023.
- Recent developments challenge the commission’s crypto enforcement approach, including a court ruling that criticised the commission’s guidance to Coinbase.
XRP is gaining momentum, pushing past the US$3 (AU$4.80) mark for the first time in seven years. Some of the news is of course on the back of the potential for an XRP exchange-traded fund (ETF) approval in 2025.
ETF guru Nate Geraci thinks it’s definitely on the cards, mainly due to Gary Gensler stepping down from his position as leader of the US Securities and Exchange Commission (SEC).
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And then there’s the January 15 deadline for the SEC’s appeal in their lawsuit against Ripple. The appeal has now come in and Ripple’s Chief Legal Officer, Stuart Alderoty, has called it a “rehash of already failed arguments”.
Alderoty believes the appeal is just “noise”, as the regulatory landscape in the US is about to change.
A new era of pro-innovation regulation is coming, and Ripple is thriving.
Stuart Alderoty, Ripple Chief Legal OfficerThe appeal in the long-lasting legal battle between Ripple and the SEC is not about whether XRP is a security – the court in a ruling from 2023 said clearly that XRP, on its own, is “not an investment contract and therefore not a security”.
SEC Stance on Crypto to Change
Rather, the SEC appeal is about the question whether sales made by Ripple directly – through exchanges and other distributions like grants and such – are “investment contracts”.
In a fact sheet, Ripple explained:
The Court agreed with Ripple, ruling that these sales and distributions did not require SEC registration. Itʼs this decision that the SEC is appealing.
RippleRipple is “cross-appealing”, mainly in an effort to “preserve all its defenses”, which also includes the notion that an investment contract “requires traditional contractual rights and obligations”.
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Most observers expect the incoming SEC leadership to toss out the lawsuit altogether.
Even without Gensler’s departure, the commission has come under fire recently. A court ruling this week dealt a blow to the SEC’s enforcement efforts by calling a SEC order against Coinbase to be “conclusory and insufficiently reasoned”.
The court asked the SEC to explain why it hasn’t provided clearer guidance to the crypto industry while stopping short of ordering it to provide crypto-specific rules.
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