Ripple CEO Brad Garlinghouse Optimistic About SEC Appeal Process in Case Against Ripple Labs
Ripple CEO Brad Garlinghouse has expressed his belief that the United States Securities and Exchange Commission (SEC) will face a lengthy process before having the opportunity to appeal the ruling in its case against Ripple Labs. This comes after U.S. district court Judge Analisa Torres ruled partially in favor of Ripple on July 13, stating that the XRP token is not a security when sold on retail digital asset exchanges.
However, as part of the ruling, Torres also stated that XRP is considered a security when sold to institutional investors, as it meets the criteria outlined in the Howey test. In an interview with Bloomberg on July 15, Garlinghouse dismissed the significance of the institutional sales decision, referring to it as “the smallest piece” of the lawsuit. He believes that if the SEC were to appeal the ruling related to retail sales, it would only strengthen the decision made by Torres.
Garlinghouse acknowledges that it could take a considerable amount of time before the SEC is able to file an appeal. He states, “As a matter of law, the law of the land right now is that XRP is not a security. Until there is an opportunity for the SEC to file an appeal, which would take years, frankly, we are very optimistic.”
The Ripple CEO also highlighted that this is the first time the SEC has lost a “crypto case,” accusing the regulatory body of acting as a “bully” by targeting players in the crypto industry who were not adequately prepared to defend themselves. In addition, Garlinghouse mentioned that when the case against Ripple was initially filed, many crypto exchanges in the U.S. took a cautious approach and delisted XRP due to the uncertainty surrounding its status.
Garlinghouse blames the SEC for causing confusion in the market, stating, “They knew there was confusion, and they actually did things that they knew would increase confusion.” He believes that this confusion has hindered innovation in the U.S. and prevented entrepreneurs and investors from fully participating in the country’s crypto market and blockchain industry.
The outcome of the Ripple Labs case has been seen by many as a watershed moment for the cryptocurrency industry. Lawyers have commented that while the ruling is positive for Ripple, there are still potential challenges ahead. It remains to be seen how the SEC will proceed with its appeal process and what implications this may have for the future of XRP and the broader crypto industry.