Bitrabo Editorial
Ripple Labs recently submitted a notice of supplemental authority to bolster its defense in the ongoing legal battle with the Securities and Exchange Commission (SEC). This submission was made to the United States District Court for the Southern District of New York in response to the SEC’s motion seeking remedies and final judgment.
Ripple Draws on Binance Case Ruling
The crux of Ripple’s defense relies on a recent ruling from the US District Court for the District of Columbia in the SEC v. Binance Holdings, Ltd. case. The decision, issued on June 28, 2024, partially upheld and partially dismissed SEC’s claims that Binance sold unregistered securities.
The court found that there wasn’t enough evidence to classify secondary market transactions of BNB tokens on crypto exchanges as securities transactions. Ripple points to this ruling as a crucial reference, highlighting its relevance due to its similarities with their ongoing legal dispute.
Referencing the Binance case, Ripple’s legal team emphasizes a key observation made by the court: “Intangible digital assets do not neatly fit into traditional securities law frameworks.” This underscores the challenge of applying existing securities regulations to new-age digital assets.
Additionally, Ripple critiques the SEC’s segmented approach to litigation, noting that overseeing the industry through a case-by-case strategy may lead to inconsistent outcomes and lack of clear guidance for stakeholders. This echoes broader concerns in the cryptocurrency sector regarding the SEC’s regulatory tactics.
Ripple insists on the importance of judicial clarity regarding the legality of XRP sales, citing the previous summary judgment. The company advocates for regulatory certainty, asserting its significance not only for Ripple but for the broader cryptocurrency market. They argue that clear regulations prior to the court ruling supported their stance against severe penalties.
The filing also delves into the alleged violations by Ripple, contending that the absence of recklessness on Ripple’s part should mitigate the severity of proposed remedies. The company’s lawyers argue that the lack of regulatory clarity prior to the ruling undermines the SEC’s strict liability violation claims against Ripple.
This notice was submitted by Ripple Labs’ legal counsels, Michael K. Kellogg of Kellogg, Hansen, Todd, Figel, & Frederick PLLC, and Debevoise & Plimpton LLP. The submission seeks to counter the SEC’s recent motions and reaffirm Ripple’s broader arguments regarding the application of securities laws to cryptocurrency transactions—a topic of ongoing legal and regulatory debates as digital assets challenge conventional frameworks.
As of now, XRP is trading at $0.47979.