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SEC APPEALS DECISION THAT RESTRICTED ITS CRYPTO OVERSIGHT

 * admin
 * October 3, 2024
 * News

(Adds Ripple CEO comments, paragraphs 8-9)
By Jonathan Stempel
NEW YORK, Oct 2 (Reuters) – The U.S. Securities and Exchange Commission said on
Wednesday it is appealing a court ruling that restricted its ability to regulate
cryptocurrency markets.
Wall Street’s main securities regulator will ask the 2nd U.S. Circuit Court of
Appeals in Manhattan to review a July 2023 decision that the XRP token sold by
Ripple Labs on public exchanges did not meet the legal definition of a security.
The decision by U.S. District Judge Analisa Torres meant the sales of the token,
totaling about $757 million, were not subject to investor protection laws that
the SEC enforces.
If the appeals court agreed, or defined securities narrowly, it could impede the
SEC’s ability to police the cryptocurrency exchange Coinbase and other
defendants selling or making markets for newer, non-traditional financial
products.
Torres also gave the SEC a partial victory, saying another $728 million of XRP
sales to institutional investors should have complied with securities laws.
She fined Ripple $125 million in August, but put the fine on hold pending an
appeal. The SEC had sought $2 billion. Torres’ stay would last until the 2nd
Circuit ruled, court records show.
Ripple can also appeal parts of Torres’ rulings that it dislikes.
Ripple CEO Brad Garlinghouse said the SEC decision to appeal was “misguided” and
“infuriating,” but not a surprise.
“While we’ll fight in court for as long as we need, let’s be clear: XRP’s status
as a non-security is the law of the land today,” Garlinghouse said in a post on
X. (Reporting by Jonathan Stempel in New York; Editing by Bill Berkrot and Jamie
Freed)


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