FameEX Hot Topics | Expert Lawyer Outlines SEC's 4 Potential Approaches in Ripple's XRP Case

Following the Ripple case ruling on XRP, attorney James Murphy has outlined four possible courses of action the U.S. Securities and Exchange Commission (SEC) may take. Notably, the SEC has expressed its intent to appeal the court's decision. The first option is for the SEC to file a "request for interlocutory appeal," necessitating permission from both Judge Analisa Torres and the 2nd Circuit Court of Appeals. The SEC must demonstrate that the ruling involves a crucial legal question, substantial disagreement exists on the matter, and an immediate appeal would significantly advance the case. Murphy recommends promptly making this appeal, usually within 30 days, and if Judge Torres grants permission, the SEC would then have an additional 10 days to seek approval from the 2nd Circuit.

Murphy further details the other three options. The second approach involves the SEC pursuing a trial on the aiding and abetting claim against Ripple CEO Brad Garlinghouse and co-founder Chris Larsen, followed by a standard appeal after the trial. The third option consists of the securities regulator dropping the claims against Garlinghouse and Larsen immediately, allowing for an immediate appeal without requiring permission. Lastly, the fourth option is for the SEC to reach a settlement.

The lawyer believes that the SEC is likely to opt for the first option due to the significant political pressure on SEC Chairman Gary Gensler to swiftly overturn the Torres decision. Additionally, the ruling's implications for the SEC's cases against various cryptocurrency exchanges, such as Coinbase, Binance, and Bittrex, add to the urgency for a swift resolution. The re-listing of XRP by crypto exchanges globally reflects poorly on the SEC, leading to increased criticism from figures like Congressman Ritchie Torres. The settlement option is considered unlikely as it would leave the precedent set by Judge Torres untested on appeal, undermining the SEC's broader "regulation-by-enforcement" approach to the crypto industry.

Murphy concludes that the SEC is likely to request an interlocutory appeal within the next two weeks, advocating for the best interests of Ripple and the XRP community by initiating the appeals process promptly rather than waiting for a year. He expresses confidence in Ripple's prospects on appeal, highlighting that the outcome could significantly impact the case's future trajectory and have implications for the broader cryptocurrency market.

Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.