The price of XRP rose 12%, following what appears to be a positive development in the case between Ripple and the United States Securities and Exchange Commission (SEC)
Positive news surfaced for Ripple and XRP at the end of last week, while the cryptocurrency can be re-listed on U.S. exchanges. In a historic SEC lawsuit against Ripple Labs, a judge involved in the discovery process recognized the viability of XRP as a currency and ‘utility’. At the same hearing, the SEC admitted that only Ripple and its affiliates are able to apply for securities illegally. Could this open the gateway for a new registration?
The meaning of XRP as currency
Judge Sarah Netburn of the Southern District Court of the United States characterized XRP exactly as Ripple’s lawyers characterize it – both as a currency and as a utility.
If Ripple successfully argues that its native currency is a currency (not a bond), the whole case falls apart. It looks like Judge Netburn is coming to that conclusion.
Since the December 22 press release of the SEC case, XRP has been withdrawn from all major cryptocurrency exchanges in the United States. Despite this, Ripple continues to grow in other markets such as Asia.
Notably, Netburn is not the chief judge in the case; he is assisting and advising the case in the discovery and mediation process. However, if Judge Netburn recognizes the applicable use of XRP as a currency before an asset, it would increase the chances that Judge Analisa Torres (the Chief Judge) will side with Ripple.
On a video posted on Saturday, lawyer Jeremy Hogan (who is not involved in the case) commented:
“If I were Ripple, I would be feeling great that my mediator and summary judge just officially said that I am essentially what I argued in my allegations.”
SEC opens up a potential path for XRP re-enlistment
Hogan also noted the SEC’s response to Judge Netburn’s question about selling illegal securities. Would users be responsible?
The SEC replied that only Ripple and its affiliates, in accordance with Section 4 of the Securities Act, would be responsible for the sale of illegal securities.
This statement alone does not allow popular US exchanges, such as Coinbase and eToro, to re-establish XRP, but it does start a potential path. Ripple needs a final decision as a viable currency or, at least, legal certainty.
To achieve this goal, it is necessary to convince the judge and the jury that the XRP works first as a currency and then as a utility.
Anyway, following the reports, the price of XRP reacted positively, adding about 12% to its dollar value.