Bill Morgan, a lawyer known for supporting XRP, has recently provided some clarity about the U.S. Securities and Exchange Commission’s (SEC) ongoing legal battle with Ripple Labs.
He addressed the concern that the SEC might use “obiter dictum” (legal comments made in passing that are not central to a court’s decision) to contest the status of XRP as a non-security in its upcoming appeal.
However, Morgan reassured the XRP community that the SEC appears more focused on Ripple’s institutional sales of XRP rather than the broader issue of whether XRP qualifies as a security.
Ripple vs. SEC: Legal Strategy in Focus
The legal clash between Ripple and the SEC drew significant attention, with many speculating how the SEC might shape its appeal.
The crux of the debate has been the classification of XRP, with the SEC arguing that Ripple’s XRP token sales violate securities laws. On the other hand, Ripple maintains that XRP does not qualify as a security, particularly when sold on secondary markets.
Earlier, the court ruled in favor of Ripple on this particular point, determining that XRP, when traded on the secondary market, does not constitute a security under U.S. law. This decision was celebrated as a partial victory by the XRP community, especially since it resulted in a significant reduction in the fine Ripple was facing.
Despite this ruling, concerns persisted that the SEC might use comments made during the court’s decision, classified as “obiter dictum,” to challenge the status of XRP in a future appeal.
SEC’s Appeal Focus: Institutional Sales
However, Morgan and Ripple’s legal team have sought to ease these concerns. They highlighted that while obiter dictum can be referred to in future appeals, it is not binding and, importantly, does not appear to be the main focus of the SEC’s current appeal strategy.
According to Morgan, the SEC has specifically targeted aspects of the ruling related to Ripple’s institutional sales of XRP, which the court had previously found could be considered securities transactions under certain circumstances.
The SEC once filed for an interlocutory appeal—a special type that can be made before the case is fully resolved. This appeal primarily challenges the court’s findings on Ripple’s institutional sales, rather than reopening the broader debate on whether XRP qualifies as a security.
Morgan believes that this signals the SEC’s intention to focus on these institutional sales rather than relitigating the issue of XRP’s status in secondary markets.
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Ongoing Concerns and the Legal Landscape
Despite these clarifications, some crypto community members remain wary of potential legal surprises. The case between Ripple and the SEC is seen as having far-reaching consequences for the broader cryptocurrency industry, particularly as it relates to the regulatory classification of digital assets.
Should the SEC’s appeal succeed in altering aspects of the original ruling, it could introduce new uncertainties regarding how XRP and similar cryptocurrencies are treated under U.S. securities laws.
As the appeal process advances, close attention will be paid to the SEC’s evolving strategy. While the focus remains on Ripple’s institutional XRP sales, the outcome of this case could still influence the regulatory treatment of XRP in the secondary market, as well as other cryptocurrencies that may find themselves in similar legal positions in the future.
Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are urged to do in-depth research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.
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