Ripple’s Legal Triumph: A New Era for Cryptocurrency
In an unprecedented turn of events for the cryptocurrency landscape, Ripple Labs has emerged victorious as the U.S. Securities and Exchange Commission (SEC) withdrew its lawsuit against the blockchain payments innovator. This news, delivered by Ripple’s CEO, Brad Garlinghouse, marks a pivotal moment for the company and the broader crypto market.
SEC Abandons Legal Battle Against Ripple
In a compelling video statement shared across social platforms, CEO Brad Garlinghouse confidently declared, “The case has finally concluded; we have prevailed.” He highlighted the SEC’s legal pursuit, initiated during the tenure of former Chair Gary Gensler, as fundamentally flawed from its inception. Garlinghouse described the SEC’s abandonment of the case as a monumental victory and a “long-awaited concession.”
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Garlinghouse criticized Gensler for his relentless campaign against the crypto sector, pointing out that his resignation coincided with the inauguration of President Donald Trump on January 20. He accused the SEC under Gensler of attempting to stifle the industry through intimidation tactics similar to those used in the Ripple lawsuit.
The SEC had accused Ripple and its leadership of raising more than $1.3 billion via an unregistered and ongoing securities offering involving XRP sales. According to the lawsuit, filed four years ago, Ripple had been distributing XRP since 2013 without adhering to security registration requirements, allegedly breaching federal securities regulations.
Ripple’s Legal Clarity Paves the Way for XRP ETFs
With the legal victory secured, Garlinghouse asserted that XRP is no longer classified as a security under the Howey Test, a pivotal legal framework for determining investment contract status. This newfound clarity not only bolsters regulatory compliance but also facilitates the advancement of XRP exchange-traded funds (ETFs), which prominent asset managers are eager to introduce.
This decision coincides with a notable shift in the SEC’s approach, now under the guidance of acting chair Mark Uyeda. The agency appears to be aligning with the current administration’s emphasis on nurturing innovation within the digital asset domain.
The announcement of Ripple’s victory had an immediate positive impact on the market, with XRP experiencing a 12% price surge, rebounding to $2.4 after a dip to $1.7 amidst February’s market volatility.
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