Lawyers

The judge has dropped “bombs” on the SEC against Ripple, argues the top lawyer – FinanceFeeds

The lawsuit against Ripple alleges that co-founders supported and facilitated Ripple’s unregistered sales of securities in 2013 and 2015, respectively.

Commenting on the recent SEC lawsuit against Ripple, attorney Jeremy Hogan, a partner at Hogan & Hogan, referred to a judge-dropped “bomb” in which she interrupted Brad Garlinghouse’s attorney Matthew Solomon to say:

“My understanding of XRP is that not only does it have a currency value, it also has a utility, and that utility is what sets it apart from Bitcoin and Ether.”

Attorney Solomon disagreed, saying that XRP is similar to Ethereum, but the judge’s testimony admits that XRP is useful and monetary.

Since currencies and securities are two different things, the SEC’s argument that Ripple is a security may lose credibility to the judge. In terms of usefulness, this is the point Ripple has been making all along.

The judge also questioned the SEC attorney that, according to his theory, “everyone who has sold XRP – including you and I – sells illegal securities.” The SEC attorney said, “No, under Section 4, only Ripple and Ripple affiliates can have illegally sold XRP.”

This statement from the SEC attorney paves the way for US cryptocurrency exchanges to re-list XRP without fear of retaliation.

The lawsuit against Ripple alleges that co-founders supported and facilitated Ripple’s unregistered sales of securities in 2013 and 2015, respectively.

In response, Ripple stated “never offered or sold XRP as an investment” and that “XRP holders do not acquire any right to Ripple’s assets, hold any ownership interests in Ripple, or participate in Ripple’s future profits. “

In addition, the cryptocurrency company argued that “the benefits depend on the near-instant and seamless processing of XRP in low-cost transactions. In contrast, treating XRP as collateral would subject thousands of exchanges, market makers, and other players in the gigantic virtual currency market to lengthy, complex, and costly regulatory requirements. “

Of the top 23 financial market areas, nine have not taken enforcement action against companies related to crypto, and the remaining jurisdictions have a milder approach to targeting fintech startups compared to the SEC.

A research report from the Rutgers School of Law, Professor Yuliya Guseva, acknowledges that the size of the U.S. cryptocurrency market contributes to the high rate of intervention by the SEC. The Howey test is a key factor in the SEC action and is no longer suitable for assessing innovations of the 21st century.

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