SEC prepares to challenge Ripple ruling

By: Dickson Arinze

August 10, 2023 5:22 AM

The SEC filed its interlocutory appeal about a month after Judge Analisa Torres issued her initial ruling.

The US Securities and Exchange Commission has filed an appeal of a July court verdict in its action against Ripple Labs, which concluded that the sale of XRP (XRP) to retail investors is not a security.

The SEC stated in an Aug. 9 letter→ to Judge Analisa Torres, the case's presiding judge, that her ruling warranted a re-examination by an appellate court.

It urged Judge Torres to put the proceeding on hold during the appeal, citing several other outstanding court issues that could be affected by the decision of the request. The SEC is presently suing several cryptocurrency companies, including Binance and Coinbase, for suspected securities breaches. 

"Interlocutory review is appropriate here." "These two issues involve controlling legal issues on which there is substantial room for disagreement, as evidenced by an intra-district division that has developed," the SEC noted.

The SEC also stated that it wishes to certify the court's ruling that Ripple's systematic XRP offerings and sales on digital asset exchanges, as well as individual sales, did not constitute securities.

In its claim against Terraform Labs, the SEC also cited the judge's decision, which said that cryptocurrencies sold on exchanges might also be securities.

The SEC letter comes nearly a month after Ripple won a partial victory over the SEC over XRP's securities status.

According to Torres, the XRP coin is not a security by itself. She did, however, state that sales of the XRP tokens might be considered securities in some instances, including when sold to large investors, but not when sold to regular traders on exchanges.