The US Securities and Exchange Commission sued Ripple and its main executives, Brad Garlinghouse and Chris Larsen, in December 2020. Ripple traded $1.3 billion in their cryptocurrency XRP as security without informing the SEC, according to the SEC.
Ripple and other parties have now claimed bias in the watchdog’s decision. Several key court decisions have been made in the last year, with both sides filing back-to-back petitions that were either granted or refused.
The financial sector has been divided about the validity of the SEC’s claims in the years since it sued Ripple.
Since 2020, the case has gone through a number of twists and turns, but no major decisions have been made.
In any case, recent events indicate that Ripple is currently on the winning side, having won a series of major motions that could be critical to its fair motion defense.
Last Monday, the court ruled in Ripple’s favour, unsealing two key documents that the company claims would provide some certainty on how the agency classified XRP when it first entered circulation in 2012.
In a recent podcast with Tony Edward of Thinking Crypto, Joseph Hall, the former SEC managing executive for policy, reviewed the state of the case, how it has developed so far, and what to expect moving ahead.
“I’m not sure what the SEC intends to prove in the XRP action either,” Hall said, adding that he remains baffled as to why the SEC brought the case in the first place.
He claimed that the Ripple network had been active for years previous to the last-minute filing of a lawsuit against them. The implications for the SEC and the crypto industry as a whole are huge.