Ripple Labs CEO Brad Garlinghouse called the SEC a “bully” following a partial victory in the ongoing legal dispute concerning XRP.
In a July 15 interview with Bloomberg, Garlinghouse criticized the SEC, describing them as a “bully” targeting vulnerable players unable to defend themselves adequately.
The SEC accused Ripple of unlawfully raising $1.3 billion through XRP sales. The judge’s ruling clarified that XRP was not viewed as a security when sold on the secondary market, but it could be considered a security when sold to institutional investors.
Ripple Wins Partial Victory in SEC Lawsuit:
A federal judge ruled that some of Ripple’s XRP sales were not considered securities offerings. This victory for Ripple resulted in an 85% surge in XRP’s value and its relisting on exchanges.
A June report by consulting firm Cornerstone Research revealed that the SEC substantially increased its enforcement actions in the cryptocurrency space in early 2023. By June 6, the agency had launched 24 enforcement actions, surpassing the previous record of 30 actions in 2022.
SEC Enforcement Actions on the Rise:
Both Ripple and the SEC can appeal the judge’s decision. Garlinghouse noted that an appeal from the SEC might prolong the process for years.
In reaction to the ruling, the SEC asserted that the court supported their stance on applying the Howey test to crypto transactions. They highlighted that various tangible and intangible assets can fall under an investment contract.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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