- Ripple-pro lawyer John Deaton admits that even though XRP is not a security, it can be considered as such when traded in the primary market.
- Ripple CEO Brad Garlinghouse expects a decision in six months.
Ripple-pro lawyer John Deaton has been providing updates in the Ripple Labs. vs SEC lawsuit with most of his comments favoring the blockchain company. In his recent post, Deaton said digital assets including Ripple are not securities, however, they can be considered as such when traded in the primary market.
While maintaining his position that Bitcoin and Ripple are not securities based on Howey Test, Deaton observes that they may be sold as such under certain conditions. In this case, the SEC would have to examine each transaction in both the primary and the secondary markets.
Can we get something straight. Digital assets themselves are NOT securities, any more than an🍊was in Howey, or #BTC was in Shavers, or 🦫s were Kemmerer, or Chinchillas were in Miller v. Chinchilla, or condos were in SEC Rel. No. 33-5247. Crypto assets can be sold as a security.
— John E Deaton (@JohnEDeaton1) May 10, 2023
According to him, any interpretation that tokens are investment contracts is false, and this has not been contested by the SEC. In the SEC vs. LBRY case, the Judge stated that secondary sales of LBRY are not in any way considered security sales.
Ripple CEO Expects Decision in Six Months
Experts have observed that the outcome of the case could change when it is established that XRP is not a security but was sold as such. It is on record that the SEC admitted in the LBRY case that the sales of that token in the secondary market are not considered a security. In his statement, Judge Analisa Torres could take a similar decision in the Ripple case. Based on this explanation, a settlement between SEC and Ripple could be one of the expected outcomes of the case.
Speaking on the case at the Dubai Fintech Summit on Monday, Ripple CEO Brad Garlinghouse disclosed that he expects the final court decision to come in six months.
The company has spent $200 million so far in defending itself against the lawsuit. In his submission, Garlinghouse called on the US authorities to provide regulatory clarity to avoid falling behind other countries in blockchain technology adoption. He further admitted that the journey has been very expensive and distractive, and it is unfortunate that other companies are beginning this journey with SEC.
In 2020, Ripple chose DIFC as the location for its Mena headquarters.
We chose Dubai as a key office for Ripple, in large part due to its forward-thinking regulatory environment. Regulators here have risen to the challenge of establishing a framework that allows the local crypto industry to thrive, create jobs and increase economic growth, while also ensuring participants act in a responsible manner.
Just like most of the XRP enthusiasts, Garlinghouse stated that he is very bullish about the crypto ecosystem in the long term as its utility and problem-solving abilities increase significantly.
XRP currently has a bearish sentiment and has fallen by 6 percent in the last seven days to trade at $0.425587. The asset could likely reach its previous all-time high of $3 when it emerges victorious in the lawsuit.
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