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Ripple and the Securities and Exchange Commission (SEC) are continuing to size each other up with various motions to help their arguments. However, the case seems to be tilting more in favor of Ripple. This can be seen in the SEC’s recent motion in which it cited supplementary authority to back its argument to strike out Ripple’s fair notice defense. Market participants have stated that the move indicates that the SEC is afraid of Ripple winning the lawsuit.
The SEC’s latest motion in the case with Ripple seems to give away the commission’s fear of losing
Ripple has continued to make the SEC task of branding its XRP token a security a difficult one.
The SEC recently submitted a notice of supplemental authorities to back a motion it filed for the court to throw out Ripple’s fair notice defense. The notice cited the case of ‘SEC vs Keener’ that was ruled on in the Southern District Court of Florida. In the case, the verdict nullified the fair notice argument of Keener on grounds that the defendant unlawfully registered as a securities dealer going by the Securities Exchange Act of 1934. Comparing the case to Ripple’s, it tried to assert that the law was clear on what Ripple should have done before the lawsuit was brought against it.
Ripple has responded to the notice by filing an objection. Ripple’s objection stated that the SEC was ignoring due process by resorting to introducing out-of-circuit verdicts to the ongoing case. Ripple also added that in the case the SEC cites, the verdict was reached after a “review of the records” while the SEC was requesting that the company’s fair notice defense be pushed over without “considering factual record.”
The back and forth exchange has brought about speculations that the SEC is afraid of the case losing grasp of control in the case. As maintained by John Deaton, an attorney who is spearheading the involvement of over 63,000 XRP holders in the case, the notice the SEC filed shows that the securities regulator is scared of letting Ripple win the day in the fair notice argument.
…the case cited by the SEC is slightly above meaningless at this point. If anything, it shows how sacred the SEC is of the fair notice defense. If it was a decision from the 2nd Circuit it would be a big deal, he said in a tweet.
A win for Ripple could significantly dent the SEC’s regulatory plans for crypto
The general sentiment in the crypto industry is that the case leaves a lot hanging on the balance for both the SEC and crypto. Market analysts have noted that an SEC win could see the commission use the case as a precedent to go after other cryptocurrencies. A win for Ripple would, however, mean that the crypto industry has regulatory clarity.
As things stand, the outcome of the case seems very likely to be in favor of Ripple This is especially because the ruling that was made in the Deliberative Process Privilege argument the commission also went in Ripple’s favor. The price of Ripple (XRP) could also benefit from the case, as more investors are expected to enter the market, if Ripple emerges successful.