Ripple Labs gets access to SEC discussion on distinguishing certain crypto assets as securities

By: Dickson Arinze

April 8, 2021 12:24 PM

Ripple legal representatives will finally have their way to uncover some points from the SEC's internal discussion on crypto which is linked to XRP as securities.

The U.S. Securities and Exchange Commission has granted Ripple Labs access to documents "expressing the regulator's understandings or views" of crypto assets.

As reported by Law360, Sarah Netburn the U.S. Magistrate Judge approved the defendant's motion that SEC minutes or memos related to crypto are likely discoverable. However, Netburn confirmed that communication emails between staff-to-staff don't need to be produced or made available.

Meanwhile, Judge Netburn left open a window for the SEC and Ripple Labs Inc to raise a dispute with the ruling.

In December 2020, the U.S SEC reportedly filed a lawsuit claiming Ripple Labs and its executives sold unlicensed security offerings in August 2013 which amounts to $1.38 billion.

However, the Ripple team was quick to challenge the SECs claims arguing that it's native token XRP is similar to Bitcoin (BTC) or Ethereum (ETH). At different intervals, the SEC has reversed its claims that BTC or Ether are Securities classifying both as commodities. 

Ripple Labs also criticized the duration of time taken for the SEC to file its complaint against XRP.

Brad Garlinghouse's counsel, believes it may be the end of SECs suit should they uncover any evidence the U.S regulators has considered XRP in same degree to BTC or Ether. Mathew Solomon noted the SEC's regulatory limits does not extend outside of securities.

The suit against Ripple came after eight years and  lawyers representing the fintech firm also believes that they can thwart the SEC's claims if they can prove contradictory intentions as to the regulators category of XRP.

Solomon added:

"We can defend ourselves if you make this discovery."

Dugan Bliss from SEC counsel also criticized Ripple for seeking to put the commission on trial by scrutinizing it's internal reviews rather than defending it's allegedly unlawful actions. Bliss stated:

"The actions of Ripple and it's executives are what needs to be the focus here."

Attorney Jeremy Hogan, who is observing the case shared a 2016 cease and desist order aimed at a Riplple Labs advisor then which describes the firm as a "digital currency company." Stating on his Twitter that the SEC has a lot of explain to the court on how 'digital currency' changed to 'digital security.'

This has been a welcomed news as XRP price is up nearly 100% as it crossed the $1 mark.