Well-known crypto attorney John Deaton believes that the SEC only has a 10% chance of winning its dispute with Ripple, with 90% odds in the company’s favor.
Deaton said that a settlement of $20 million or less would represent a significant legal triumph for Ripple, a sentiment echoed by many in the crypto community.
Ripple vs. SEC
The lawsuit, which the SEC initiated against Ripple Labs in December 2020, alleged that the company conducted an unregistered securities offering by selling its native token, XRP.
However, the case has evolved significantly in recent months, when Judge Analisa Torres determined that XRP was not a security when traded on the secondary market. Moreover, the charges against Ripple executives were reduced along the way.
Deaton’s recent comments were prompted by a post from Ripple’s Chief Legal Officer Stuart Alderoty, who highlighted that the SEC faced a recent defeat in the case of the SEC versus Govil, where the U.S. Court of Appeals for the Second Circuit ruled that the SEC cannot request a substantial disgorgement award without first demonstrating actual financial harm to investors.
In essence, the ruling implies that if there’s no harm, there’s no penalty.
90% chance of win
Deaton strongly refuted that the lawsuit’s outcome was an even 50/50 for the SEC, contending that it’s closer to a 90/10 advantage in favor of Ripple. His assessment resonates with the sentiment in the crypto community, which generally views a suggested $20 million settlement as a favorable resolution for Ripple.
The ongoing legal battles have brought Ripple and the SEC to the forefront of discussions in the crypto space. The uncertainty surrounding the legal status of XRP and other digital currencies has left many in the industry closely following the developments in this case.
In a related development, Judge Analisa Torres recently approved an order regarding the SEC and Ripple’s joint request to propose a briefing schedule to address institutional sales of XRP. This aspect of the lawsuit pertains to the segment in which Ripple was determined to have breached securities laws.
Both parties have been instructed to provide a joint briefing schedule no later than Nov. 9, suggesting that further developments in the case are on the horizon.
The case also serves as a significant reference point for the broader regulatory environment for digital currencies as the industry navigates evolving legal interpretations and regulations.
Be the first to comment