SEC decided to withdraw its consent to Ripple’s dual motion requests in this case
New York City: It’s been years since Ripple and the SEC first filed their case against each other. However, the security commission has closed every door that may lead to the case being reversed. Today, the regulatory body turned down two motion petitions that had been submitted by SpendTheBits and Investors Choice Advocate.
As a direct result of the Ripple case, two separate groups have filed an appeal with the court. An amicus curiae brief was submitted by the groups SpendTheBits and the Investors Choice Advocate earlier in this month. They wanted to partake in the activity in the expectation that it would reduce the risk of lawsuit.
An amicus curiae is a summary judgment that is submitted by an organization that is not directly involved in a case but is ready to attempt to sway the decision of the court.
In the meanwhile, SEC declined to continue providing support for the brief. On Wednesday, the organization issued a paper stating that if the court agrees to hear the appeal, then it is obligated to fulfill the group’s requirements. When they said they demanded something, they meant that they wanted a say in the reply brief that they provided to push forward their notion for a summary judgment.
In December 2020, the Securities and Exchange Commission (SEC) once again accused Ripple Labs of engaging in an unlawful public issuance of XRP. According to the complaint, Ripple has sold XRPs for a total of $1.38 billion without first obtaining a license. On the other hand, Brad Garlinghouse and Chris Larson contended that the sales did not violate any laws.
The Howey test that the SEC carried out on XRP contributed to the escalation of the debate. It was for the purpose of determining whether the asset in question should be classified as a commodity or a security. However, XRP did not pass the criteria, and as a result, it was determined that it is not a security.
Ripple has said that it was engaged in the transaction that was announced by the SEC; however, it has also stated that it has declared that XRP does not fulfill security criteria. This was shown by the outcome of the Howey test. A first layer of protection is provided by an investment contract, which XRP did not have at the time.
Garlinghouse indicated that there was no written or verbal contract associated with the XRP when he was appearing on Fox Business. In the meanwhile, the SEC has disproved the assertions that XRP could not pass the Howey test. In addition, the SEC declined Capital.com’s request to comment on the matter.
Additionally, TapJets, a private charter aircraft firm, and I-Remit, a payment provider, have just requested to write an amicus curiae brief in support of the plaintiff. Both companies emphasized how essential Ripple and XRP were to their operations in their respective statements. During this time, the SEC demanded that the judge who was presiding over the case disregard the request.
The SEC maintained that the brief was not relevant to the matter that was now being heard. Ripple, on the other hand, said that it was crucial since it demonstrated that investors did not expect profits from XRP. Ripple added that if the SEC was unable to determine whether or not its charges were genuine, then the SEC shouldn’t have brought it up in the first place.
Philip Goldstein, founding partner of Bulldog Investor, SpendTheBits, and Investors Choice Advocator Network, has sought to submit a summary judgment ever since more groups have tried to file amicus curiae papers.
Charles Hoskinson, the creator of Cardano, provided his perspective on the litigation in the form of a tweet. It was verified by him that the Howey test was not passed by XRP because of its layer-1 feature. As a result, it was inappropriate for the SEC to impose security standards on an asset that had a great number of individual investors.
He went on to say that due to the usefulness that XRP may potentially provide, it would outlive any of the people who had a hand in creating it.