Ripple VS SEC update: Legal experts highlights SEC’s latest reply to Ripple’s filing, saying that it can critically shape the final decision on regulatory clarity and penalties. By Rupam Roy July 4, 2024
Highlights
- The SEC disputes Ripple’s comparison to the Binance ruling, calling it irrelevant to their case.
- Ripple argues that the Binance decision highlights the need for tailored crypto regulations.
- Legal experts suggest the SEC’s response indicates frustration over Ripple’s use of the Binance case.
Ripple Vs SEC Update: In a dramatic turn in the Ripple and SEC legal saga, the SEC’s latest filing has sparked fresh controversy. For context, in a recent filing, Ripple highlighted a recent court decision involving Binance to argue against the SEC’s proposed penalties.
Following that, the U.S. SEC has filed its response to Ripple’s notice. This maneuver has intensified debates on regulatory clarity and enforcement, as Ripple pushes back against what it sees as overreach by the SEC.
Ripple Vs. SEC Update: SEC Responses Challenging Ripple
The Ripple Vs SEC has escalated with the SEC’s recent response to Ripple’s latest filing. Ripple referenced a recent ruling in the SEC’s case against Binance, aiming to bolster its position against the penalties proposed by the SEC. However, the SEC’s filing dismisses Ripple’s reliance on this ruling as irrelevant to the current proceedings.
In its response, the SEC criticized Ripple’s use of the Binance decision to argue for reduced penalties. Notably, the SEC contended that Ripple’s conduct and the context of the Binance case are distinctly different.
Besides, the filing noted that Ripple’s assertion that the Binance ruling supports its position lacks substance, stating that the court’s comments on the SEC’s litigation strategy in Binance do not justify reduced penalties for Ripple. Besides, the SEC emphasized that Ripple had acted with “reckless disregard for the law” and that the Binance ruling does not mitigate Ripple’s violations.
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However, crypto lawyer Bill Morgan commented on the SEC’s frustration, suggesting that the SEC’s language indicates its displeasure with the Binance decision being used against them. He remarked that the SEC tends to dismiss decisions it dislikes as “not an authority.”
Meanwhile, the SEC’s latest filing also highlighted that, contrary to Ripple’s claims, the court in the Binance case dismissed the fair notice defense, similar to what had occurred in Ripple’s case. Besides, the SEC pointed out that the Binance ruling found the fair notice argument unconvincing, underscoring that the digital asset industry had been on notice since the SEC’s 2017 DAO Report.
This report was considered a significant warning to the industry about the regulatory landscape for digital assets, undermining Ripple’s claim of a lack of fair notice.
Lawyers Weigh In Amid Binance Case Reference
Ripple’s recent filing aimed to leverage the court’s decision in the Binance lawsuit, arguing that it underscores the need for clear regulatory guidance. Ripple suggested that the Binance ruling supports the notion that existing securities laws do not seamlessly apply to cryptocurrencies.
This argument aligns with Ripple’s broader strategy to push for more tailored regulations for digital assets, distinct from traditional securities laws like the 1946 Howey Test. Notably, Jeremy Hogan, a partner at Hogan & Hogan, criticized the SEC’s response as evasive.
He argued that the SEC failed to provide substantive reasons for disagreeing with Ripple’s interpretation of the Binance ruling. Instead, the SEC merely stated its disagreement without elaboration, a tactic Hogan described as frustratingly common in legal disputes.
Furthermore, he urged for more concrete arguments from the SEC, reflecting the broader sentiment in the cryptocurrency community for clearer regulatory reasoning. Ripple’s reference to the Binance case aims to highlight inconsistencies in the SEC’s approach to digital asset regulation.
By citing the court’s observation that cryptocurrencies do not fit neatly into existing securities frameworks, Ripple seeks to bolster its case for reduced penalties and more precise regulatory guidelines. This move emphasizes the industry’s ongoing call for clarity from regulators to ensure fair enforcement and compliance.
