There’s the thing! Ripple has won the crucial court case against the American securities regulator SEC. XRP is therefore not officially a security, at least not for XRP traded on exchanges. The course knows no stopping and is also pulling the rest of the crypto market north. That’s the background.
Ripple emerges victorious in its legal battle against the US Securities and Exchange Commission (SEC). The SEC had accused Ripple of considering XRP a security, leading to a prolonged legal dispute that has now been resolved in Ripple’s favor. Consequently, according to US law, XRP traded on exchanges is not classified as a security. The trading of XRP on stock exchanges does not meet the criteria outlined by the Howey test for determining securities.
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Moreover, activities involving rewards, investments, grants, and transfers to executives denominated in XRP are not deemed securities either.
However, the judge ruled that institutional sales of XRP should be treated as unregistered securities transactions. You can find the full document detailing the ruling here (PDF). This landmark ruling holds significant implications not only for Ripple but also for the entire cryptocurrency sector, setting a precedent for future cases.
This outcome deals a significant blow to the US agency and its chairman, Gary Gensler, who had advocated for classifying the majority of cryptocurrencies as securities. The market response to the ruling has been overwhelmingly positive. Within minutes, the price of XRP surged by over 30 percent, and other cryptocurrencies followed suit, turning their earlier negative trends into positive ones.
Now, it remains intriguing to observe how this court ruling will impact the ongoing struggle between the SEC and the cryptocurrency sector. If XRP is not considered a security, it raises the likelihood that other cryptocurrencies may also escape this classification. This optimistic prospect has engendered a positive sentiment across the entire market.
