The US Securities and Exchange Commission (SEC) has launched a sudden attack on Ripple by submitting a letter of supplementary authority to defend Ripple’s “fair notice.” At the same time, token XRP fell 2.33% to $ 0.7 over the last 24 hours, following a downtrend in the market.
SEC Surprise Move
As the popular SEC vs. Ripple case is expected to be resolved around April this year, the SEC has made new moves, leaving many questions as to whether previous expectations could change.
US regulators are using a winning move from another case to attack Ripple’s main debate.
In September 2020, the SEC said it sold $ 21 billion of Penny shares and made a profit of $ 61 billion without registering John M. Fif and the five entities he manages as security dealers. I brought it to the court.
FIFE’s defense adopted the same argument as Ripple’s defense, arguing that the SEC did not give a fair warning and that the term “dealer” could be broadly interpreted. Last month, the court denied the allegation.
What does that mean for Ripple Case?
Not surprisingly, regulators were now aiming to use this denial to attack the critical defenses of Ripple’s “fair notice.”
Similarly, Ripple’s “fair notice” defense alleged that regulators did not notify about possible violations of federal securities law, and that the term “investment contract” was misused by the SEC. SEC theory, XRP is an investment, “he added. The contract is wrong in fact, law and stock. “
No foreign regulator has determined that XRP is security. In fact, the exact opposite is true. The United States is an unfortunate outlier.
Using the latest results of the FIRE case, the SEC claims that the term “investment contract” is bound by legal parameters since 1946.
In the case of Ripple, the binding authority to interpret the term “investment contract” has existed since 1946. WJ Howey Co., 328 US at 298–99. therefore, Fife It provides additional authority to strike Ripple’s fourth affirmative defense.
However, the case has a clear term.lawyer Jeremy Hogan Explanation Through Twitter, the result of the FIRE case is “Slightly assisting the SEC’s position in a motion to defend Ripple’s fair notice, the SEC submitted it to court. “
While the SEC is trying to break away from the similarities in both cases, Hogan argues that Fife “is at a very different stage in the proceedings and the standards are completely different from the SEC vs. Ripple case.” increase.
In the case of “Fife”, the defendant tried to claim “fair notice” (and failed) to completely dismiss the proceedings because the burden on the parties moving to strike the complaint was so high. did). In the case of Ripple, it is the SEC that is trying to take a positive defense of fair notice, and there is a high burden to deal with it.
Brad Garlighouse, CEO of Ripple, had hope until the end of 2021 when he told CNBC:
Obviously, the judge has asked a good question. And I think the judge understands that this has a broader meaning than just Ripple.
Related reading | XRP gains momentum with a 7% increase as Ripple launches a new ODL partnership
Impact on XRP
Related reading | Ripple was the strongest year in history, despite the SEC’s “attack on cryptography.”
The next hearing will be the result of the Ripple incident, an important day for the price of XRP.
The timing of XRP is quite complicated. The downward trend seems to follow the movement of the general crypto market. As shown in the graph below, XRP has decreased by 2.33% to $ 0,7634 in the last 24 hours.
After the SEC filed a proceeding against Ripple in December 2002, the price of XRP plummeted from $ 0.60 to $ 0.1748. It keeps falling and loses ground, but stays in the top 10 crypto rankings.
After that, XRP recovered throughout 2021 and reached a high of $ 1.34 on November 10, 2021, but could not finish the year above $ 1.01.
The expectation of XRP enthusiasts is that Ripple will win the proceedings, XRP will attend a large rally and soar to a record $ 3.4 or double. However, previous forecasts did not take into account the current downtrend in the crypto market.
And if Ripple’s case has a surprisingly negative solution, XRP may see equally sad results.