XRP investors have been the recipients since the U.S. SEC imposed charges on the startup of blockchain Ripple for alleged sales of XRP bonds in 2020. Since then, there have been several inconsistencies in the case, fueling volatility in the XRP price.
The SEC x Ripple battle has reached new levels. In addition, current developments have also made the community member anxious. In its recent filings, the SEC noted that Ripple “failed to develop a use case” for XRP.
Chief Prosecutor John Deaton in the XRP Holders motion tweeted about the matter.
I’ve read closely their defense and… they’re arguing that the conduct of the SEC and of the market created a lack of clarity on the question of how XRP should be regulated.
It is not entirely clear to me still, why Ripple’s state of mind on that question is relevant. https://t.co/5HBaFtHfJB
– John E Deaton (@ JohnEDeaton1) May 24, 2021
I have carefully read their defense and … they are arguing that the conduct of the SEC and the market has created a lack of clarity on the question of how XRP should be regulated.
It is still not entirely clear to me why Ripple’s state of mind on this issue is relevant.
The volatility of XRP prices recently was largely due to the uncertainty surrounding the case. Some believe that there is a high chance of a possible settlement between the SEC and Ripple. In one of his other tweets, Deaton says he is “trying to intervene so that the XRP Holders have a seat at the table to be heard during the discussions”.
There is a fear among XRP holders that what would happen if both sides agreed on an outcome in which the XRP holders were the only ones to lose. Note that the token holders are not the same as the shareholders of a company. But the battle doesn’t seem to end amicably anytime soon.
SEC wants to testify more witnesses in Ripple case
The US SEC recently asked Judge Sarah Netburn to testify other witnesses in the case. This includes former Ripple CFO Ron Will and former Xpring senior vice president Ethan Beard.
The SEC notes that the need for additional depositions has been considering the broad scope of the case and “the absolute scale” of Ripple’s XRP offerings. In addition, the SEC wants the court to order Ripple to produce documents of his lobbying efforts.
In June 2020, former CFTC President Chris Giancarlo said XRP was not an unregistered security. However, the SEC claims he was on the ripple payroll. The securities regulator observed:
Ripple relies on statements it paid that officer to make to support its litigation position… Since Ripple has called into question its alleged lack of “fair notice” based on the beliefs of market participants, the SEC has the right to test whether the alleged “mess” was purchased and paid for by Ripple, as opposed to a reflection of genuine market sentiment
There were also questions about the massive settlements by former Ripple CTO Jed McCaleb, but these were not disclosed.
Source: Coin Speaker