Ripple, SEC files summary judgment as crypto community watches closely
The matter between US SEC and Ripple Labs could eventually end after both parties moved for summary judgment.
According to motions filed in the US District Court of the Southern District of New York, the two parties are asking the court to grant summary judgment based on the evidence and arguments already presented.
Motions for summary judgment are usually filed when one of the parties does not disagree with the facts of the case and wants to avoid a lengthy trial.
Ripple’s argument
Ripple attorney James K. Filan tweeted about the new development, saying that Ripple’s current CEO, Brad Garlinghouse, and former CEO, Christian Larsen, also filed for summary judgment.
The defendants have argued that the SEC has no jurisdiction over XRP since the token was sold on foreign exchanges.
Ripple also argued that XRP is not a security under the Howey test, as the transfer does not involve an investment contract.
Stuart Alderoty, Ripple’s general counsel, said:
“The SEC is not able to identify any contract for investment (that is what the law requires); and cannot satisfy a single prong of the Supreme Court’s Howey test.”
Ripple CEO Garlinghouse confirmed Alderoty’s view, saying the SEC was not interested in applying the law. Instead, the regulator is trying to expand its “jurisdiction far beyond the authority granted to them by Congress.”
Today’s filings make it clear that the SEC is not interested in applying the law. They want to recreate it all in an impermissible attempt to expand their jurisdiction far beyond the authority granted them by Congress. https://t.co/ooPPle3QjI
— Brad Garlinghouse (@bgarlinghouse) 17 September 2022
The crypto community is keenly interested in the case outcome
The crypto community is closely following the case between the SEC and Ripple, as the outcome could have a major impact on how the regulator may classify crypto assets.
Currently, the prevailing thinking at the SEC is that most cryptoassets are securities that should be registered under the Securities Act. SEC Chairman Gary Gensler echoed this view before a committee of US senators. He told reporters that digital assets operating on the proof-of-stake mechanism could qualify as a security.
Several cryptoassets, such as Cardano (ADA), Ethereum (ETH), Solana (SOL), etc., operate under this mechanism.
Apart from that, the commission has filed several lawsuits against digital asset companies like Coinbase over the listing of assets it qualified as securities.
