- Congressman Lynch claimed that the SEC “half-won” its lawsuit against Ripple.
- Ripple’s CLO suggested that SEC’s appeal worked in the former’s favor.
In the past few weeks, Ripple [XRP] experienced a surge of positivity following a favorable judgment in the SEC lawsuit. Despite this positive momentum, recent comments made by members of Congress may have the potential to cast a shadow over its progress.
The optimistic trajectory of Ripple’s developments might be affected by the implications of these recent remarks, causing some uncertainty among investors and market participants.
Winners and losers
Congressman Lynch recently claimed that the SEC “half-won” the lawsuit against Ripple while retaliating against the claim that the SEC has been exercising regulation by enforcement. He later stated that due to guidelines imposed upon crypto firms, the SEC has been in the clear in its recent legal proceedings.
He then went on to state that out of the 131 cases that Gary Gensler, chairman of the SEC, has fought, he’s won 130 and half, including the one against Ripple.
The situation so far
For the uninitiated, Judge Analisa Torres issued a ruling on 13 July, stating that XRP was not considered a security during its public sale on cryptocurrency exchanges. However, the judge also determined that XRP could be regarded as a security when sold to institutional investors.
In response to this ruling, on 21 July, the SEC used its ongoing case against Terraform Labs founder Do Kwon to express its discontent with the decision. Furthermore, the SEC indicated that it might pursue an appeal against the split-decision ruling at a later stage.
This development added further uncertainty to the regulatory status of XRP and could have potential implications for the cryptocurrency’s future.
Ripple remains confident
Ripple’s chief legal officer, Stuart Alderoty, dismissed concerns about a possible appeal by the SEC regarding the significant Ripple ruling from earlier this month. Alderoty was of the opinion that if the SEC does decide to appeal, the court may go on to strengthen Ripple Labs’ partial triumph even more. This indicated Alderoty’s confidence in the potential for further favorable outcomes in the ongoing legal proceedings.
30+ years as a lawyer, and crypto is, without a doubt, the most fascinating industry I’ve been a part of.
Thank you @jacqmelinek for having me on to discuss what the lawsuit decision means, where the SEC has jurisdiction (and more importantly where it doesn’t), and much more. https://t.co/lozorZeTyL
— Stuart Alderoty (@s_alderoty) July 25, 2023
On the regulation front
However, the minutia of the SEC’s appeal won’t be the only factor that would be impacting Ripple’s future. On a macro level, the larger regulatory framework created by the U.S. government will also play an important role.
This week, a crucial congressional committee will vote on bills to regulate cryptocurrencies. The proposed legislation aims to classify cryptocurrencies as securities or commodities, and establish oversight for stablecoins. It’s the first time that crypto regulation bills face a congressional vote, and their Democratic support remains uncertain.
The House Financial Services Committee previously approved the Republican-led bill with a 35-15 vote, along party lines. A few Democrats, including Jim Himes and Ritchie Torres, also voted for it, citing issues with the current system. The bill might face challenges in the Democratic-led Senate, as Senator Sherrod Brown is unsure of the need for more crypto regulation.
Representative Patrick McHenry, the Republican committee chair, prioritizes advancing a crypto market structure bill. The bill is set to expand the CFTC’s oversight and clarifies the SEC’s jurisdiction to address concerns of perceived overreach.
Ripple continues to make progress
Despite the regulatory uncertainty in the U.S., Ripple continued its efforts to expand in various regions. Recently, Ripple announced that its stablecoin project with the Republic of Palau has entered a Phase One pilot.
The Republic of Palau is partnering with Ripple to pilot a USD-backed stablecoin on the #XRPLedger.
— Ripple (@Ripple) July 27, 2023
Under the Palau Stablecoin pilot program, selected government employees are voluntarily using PSC with chosen local merchants in Palau. This controlled stablecoin pilot utilizes the Ripple CBDC Platform, which offers an end-to-end solution for central banks to issue their own digital currency.
Read Ripple’s [XRP] Price Prediction 2023-2024
Through this platform, Palau can efficiently manage and customize the stablecoin’s entire life cycle, including transactions, distribution, and redemption.
State of XRP
Only time will tell how these events impact XRP in the long run. At press time, XRP was trading at $0.713, after witnessing some positive movement in the last few days. Additionally, the number of token holders of XRP also observed growth during this period.
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