Following the summary judgment delivered in favor of Ripple in the ongoing XRP vs. SEC lawsuit, the Chair of the United States Securities and Exchange Commission (SEC), Gary Gensler, remains taciturn on the commission’s next line of action.
During a segment on Bloomberg TV, Gensler was evasive on questions bothering on whether the SEC intends to appeal the judgment. He, however, maintained that the SEC was yet to take a decision, having previously expressed disappointment over the ruling stating that the agency intends to evaluate the ruling in the Ripple Labs lawsuit.
Uncertainty Trails Gensler’s Evasiness
In a ruling delivered by Judge Analisa Torres on July 13, 2023, the XRP token was classified as a security primarily when selling them to institutional investors, while sales to retail investors were considered not to be a violation of federal securities law.
The impact of the ruling was massive as major crypto exchanges like Coinbase relisted the XRP tokens on their platforms. The market reacted positively, with XRP experiencing impressive price rallies, reaching $0.80 in light of the favorable decision.
Following the ruling, there has been a demand for clarity on what the SEC intends to do next. But SEC Chair Gary Gensler has largely refrained from offering any meaningful statement, only stating that the SEC is currently analyzing the decision.
However, he maintained his position that the crypto industry still continues to fall short of meeting the demands of securities laws, irrespective of the recent XRP judgment.
Deliberate Strategy Or Fear Of XRP’s Strengths?
The cryptocurrency space has been awash with speculations over the likely implications of Gensler’s silence. Experts postulate on the options available to the SEC, with most believing an appeal is not far from the table.
John E. Deaton, an attorney for XRP holders, noted that an appeal does not necessarily mean a setback for Ripple. Also, Ripple’s Chief Legal Officer, Stuart Alderoty, stated that should XRP be considered not a security, then the SEC will automatically lose its jurisdiction over the trading of XRPs.
However, former SEC official John Reed Stark has re-echoed Gensler’s position, stating that the decision in XRP vs. SEC lies on “shaky ground” and will invariably be appealed. Stark argued that the ruling failed to differentiate clearly between private sales of XRP to institutional investors and sales to exchanges. He postulated that this would likely birth a new class of “quasi-securities,” whose status will be subject to the investors’ sophistication.
There have been speculations that Gensler may likely resign in light of the ruling. Rumors of the resignation have been largely amplified by members of the XRP community.
The SEC was forced to issue a statement confirming that its Chair was not resigning and was only focused on pursuing the objectives of the commission.
Meanwhile, with the prospect of an appeal looming large on the horizon, the future of XRP and the cryptocurrency industry remain far from certain.
