Ripple, a real-time gross settlement system, currency exchange, and remittance network, has achieved a significant legal victory against the U.S. Securities and Exchange Commission (SEC), which had asserted that Ripple's native token (XRP) should be classified as a security. This court ruling establishes a precedents that could potentially protect numerous other cryptocurrencies from facing scrutiny by the SEC.
In lawsuits filed by the SEC against major cryptocurrency platforms like Coinbase, Binance, and Kraken, the regulatory agency had been categorizing altcoins as securities, which would result in a series of negative consequences for investors.
Judge Analisa Torres, presiding over the case in New York, has determined that the trading of XRP on cryptocurrency exchanges does not constitute an investment contract, despite acknowledging that the institutional offering violated securities laws. While the court's decision does not fully satisfy all of Ripple's demands, it is seen as a triumph for the company, decreasing the regulatory pressure it has faced.
In an interview with CNBC, Paul Grewal, Chief Legal Officer of Coinbase, expressed great optimism regarding the outcome of their legal battle with the SEC. He stated, "I think we're going to win. We already had that perception, which is now strengthened by the decision on the Ripple case." Coinbase's shares have already seen a 33% increase during the week.
Following the favorable ruling, the price of XRP experienced a rapid surge of over 50% in just over 30 minutes. By approximately 7 p.m., its value had risen by 73%, reaching a trading price of $0.81. The surge in price is a direct result of XRP being deemed not a security, which removes SEC's jurisdiction and sets a precedent for future lawsuits against the regulatory agency, according.
This court decision holds significant implications for the overall market, particularly benefiting those affected by the SEC's actions against Coinbase and Binance. Maybe it marks the beginning of a bullish trend in the cryptocurrency space. The ruling eliminates investment risks and reopens doors for investors. Moreover, it weakens the SEC's case against Coinbase and strengthens the prospects for approving a BTC spot ETF in the United States.
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