Hristina Vasileva
The US Securities and Exchange Commission (SEC) requested a new deadline for its lawsuit against Ripple, Inc. In the latest filing, an appeal deadline may be extended into early 2025.
The SEC requested a January 15, 2025 deadline for its appeal brief in the long-running case against Ripple, Inc. The SEC has gone through multiple rounds of appeals, even sparking recent expectations that running out of deadlines means the case is settled.
However, the case for XRP may not be settled until early 2025, if the SEC receives another date to present its arguments. In the past few days, the Ripple community closely watched the actions of the SEC, hoping Gary Gensler would miss the deadline, signaling the regulator has no more demands on Ripple. Not even the $125M fine has worked to settle the lawsuit, as the SEC is still trying to appeal its position on XRP.
Ripple itself has to keep the November 1 deadline to file an Acknowledgment and Notice of Appearance form. The paperwork will allow the Ripple legal team to represent the company during the appeal hearing, without further requesting permission.
On its side, the SEC filed a Notice of Appeal on October 2, but failed to file additional Forms C and D by October 16, which was considered the end of the two-week grace period. However, this did not jeopardize the Commission’s right to appeal, as the SEC filed its Form C on October 17, still within reason given the two-week deadline included bank holidays.
In addition to filing its Form C pre-argument statement, the SEC also requested a ‘de novo’ preview of the Ripple case, planning to ask the court to review its decision based on questions of how the law was implemented.
Stuart Alderoty, chief legal officer at Ripple, Inc., has noted that the appeals will not overturn the decision that the XRP sale did not fail the Howey test and did not create an unregistered security. Alderoty also believes the SEC is still trying to enforce compliance, despite losing its case on the security status of XRP.
US SEC targets multiple crypto startups with lawsuits
The SEC has been on a regulatory spree, with multiple lawsuits filed against crypto startups of various sizes. The Ripple case is just one of the high-profile cases underscoring the overall drive of the regulator to limit the activities of crypto companies. The SEC has filed both against well-established, functional crypto companies, as well as outright Ponzi schemes or scams.
Multiple crypto startups have limited their development due to the engagement of the SEC. An ongoing lawsuit also makes exchanges reluctant to list the new project. The SEC also levies heavy fines, which not all crypto startups can pay.
The biggest concern on the status of XRP is its potential for serving as an underlying asset for a new ETF. In the case of Ethereum (ETH), the ETF products were only allowed after it became clear ETH was not a security but a utility token and a commodity.
XRP has long hoped for an ETF, due to its legacy status as a blue chip token with high visibility. The ETF launch, or at least the end of the lawsuit against the SEC, is also seen as a way out of the price stagnation and toward wider adoption
XRP has been drifting sideways for years, failing to recover its previous highs or even the $1 level. XRP is now hovering around $0.53, with no significant reaction to the news of the renewed lawsuit request. The long-running lawsuit, going through multiple stages since 2020, also caused XRP to be temporarily delisted from major exchanges, further cutting into its price potential.
