Ripple vs SEC Case As of May 31, 2024: XRP Price Affair

Ripple, the San Francisco-based has filed a reply brief in its ongoing lawsuit with the U.S. Securities and Exchange Commission (SEC) addressing the SEC’s arguments regarding its request to seal certain exhibits related to the SEC’s motions for remedies and judgment.

Ripple’s latest filing, shared by James K. Filan on X, emphasizes that it has already addressed many of the SEC’s arguments in its previous opposition brief. However, the filing also responds to two specific points raised by the SEC in its May 21 opposition brief.

Read Also: SEC to Unveil Latest Filing Against Ripple in XRP Lawsuit. Here’s When

Firstly, Ripple disagrees with the SEC’s assertion that details regarding its current financial status are relevant to the court’s determination on remedies. The firm argues that its financial health is irrelevant to its ability to pay any potential penalty. Instead, Ripple emphasizes its desire to protect highly confidential business information to shield its interests and those of third parties.

Secondly, Ripple refutes the SEC’s claim that past XRP sales contracts are irrelevant due to changes in Ripple’s XRP sales methods. Ripple highlights the importance of protecting the confidentiality of these contracts. The company argues that disclosing the terms of past contracts could give future counterparties undue leverage in negotiations.

Impact on XRP Sales and Price

Ripple’s filing also clarifies how its current XRP sales practices differ from those referenced in the court’s summary judgment regarding “institutional sales.” Ripple contends that its current sales of XRP for use with its On-Demand Liquidity (ODL) product lack the characteristics of the institutional sales discussed in the summary judgment.

Specifically, Ripple argues that current ODL-related XRP sales do not involve any of the features the court found relevant in its classification of past over-the-counter (OTC) contracts as investment contracts, such as discounts offered to sophisticated investors.

This distinction is significant because some critics have accused Ripple of suppressing the price of XRP through continuous sales for ODL purposes. These critics point to Ripple’s monthly release of XRP from escrow, where 20% remains unlocked and potentially sold to ODL clients, thereby increasing circulating supply.

Read Also: Ripple v. SEC Lawsuit As of May 9, 2024: “Waiting for the Judge” 

However, Ripple’s filing suggests that ODL sales likely have a neutral impact on XRP price, a point reiterated by prominent attorney Bill Morgan. ODL sales are conducted without the price discounts previously associated with XRP sales considered securities by the court.

Ripple’s Chief Technology Officer (CTO) David Schwartz has constantly dispelled rumors of price suppression. Similarly, Morgan described this filing as a crushing blow to bad-faith actors pushing the price suppression narrative.

---

Follow us on Twitter, Facebook, Telegram, and Google News