Crypto firms facing US SEC charges find hope in Ripple ruling, experts say
A cryptocurrency developer's landmark legal victory against the US Securities and Exchange Commission (SEC) will galvanize Coinbase and other companies to resist the agency's attempt to assert its jurisdiction over the industry, experts said.Thursday's ruling that Ripple Labs did not violate securities law by selling its XRP token on exchanges was the first major setback for the SEC in a decade of enforcement against the cryptocurrency industry.
Other crypto firms accused of illegally operating digital asset exchanges are exploring ways to take advantage of the ruling, according to two sources familiar with the matter who asked not to be named because they were not authorised to speak publicly.The crypto industry is in a tug-of-war with the SEC and its Democratic chair Gary Gensler, who has described the crypto market as a Wild West riddled with fraud.
Saying most crypto tokens are securities, the SEC has cracked down on crypto trading platforms, including the top US exchange Coinbase, in an effort to bring the industry under its oversight.Crypto firms have long disputed the SEC's jurisdiction but until Thursday no court had supported that view.
Now, industry lawyers have ammunition to fight back."This case will cause people to rethink, and I think it already has," said Robert Frenchman of Mukasey Frenchman LLP.The two sources, for example, said firms are considering ways to use the Judge's ruling for their defense. "I can’t imagine any of the exchanges won’t use this in some way," said one.In 2020, the SEC sued San Francisco-based Ripple and its current and former chief executives, alleging they conducted a US$1.3 billion unregistered securities offering by selling XRP, which Ripple's founders created in 2012.US
