Shows what could happen to XRP if the case has a good outcome https://t.co/uA63GMgxW4

— bill morgan (@Belisarius2020) January 31, 2023

Morgan’s comments came at a time in which the crypto community is expecting a summary judgment on the XRP lawsuit after both the SEC and Ripple asked for it.

Read Also: LBRY Calls On Coinbase to Relist XRP in Line with Latest Verdict: Details

Meanwhile, a similar case between the SEC and another fintech firm, blockchain-based sharing platform LBRY, has shared insights as to what could be expected in the Ripple-SEC case.

The SEC sued LBRY in March 2021 over the platform’s sale of its LBC tokens without registering with the regulator. Although the LBRY team didn’t offer the tokens through an initial coin offering (ICO), they kept some tokens for themselves before releasing them on secondary exchanges to fund operations.

Read Also: How LBRY’s Recent Win Against the SEC is Reviving Hope in the XRP Community

The summary judgment of that legal case saw a judge argue that LBC tokens incentivized the project’s team to keep building on the network, which suggested to investors it would be a profitable investment on the secondary market.

Late last month, during an appeal hearing in New Hampshire, a judge clarified that LBC tokens are only considered securities at the time of direct sale. The clarification resulted in a massive increase in the price of $LBC, which in turn enhanced the expectation of a similar outcome for XRP.

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The post Legal Expert Suggests XRP Could Skyrocket Like LBC Token If SEC Lawsuit Ends in Ripple’s Favor appeared first on Times Tabloid.

The district court recently gave a ruling that LBC sales in the secondary market cannot be categorized as securities offerings as alleged by the SEC. Accordingly, members of the XRP community are more confident Ripple could also win the securities agency in the ongoing XRP lawsuit.

Recall that the SEC, who claims that all altcoins including XRP are unregistered securities, filed a lawsuit against LBRY, arguing that the project’s native token LBC is an unregistered security offering. The case which lasted for several months finally ended last November with the SEC as the winner. LBRY lost as the presiding judge ruled that the LBC token is an investment contract. 

This was a huge blow to the developing cryptocurrency industry as it further boosted the Gary Gensler-led regulatory agency’s confidence to push its agenda of achieving crypto regulations by enforcement. Especially after it became understandable that the U.S. Congress will issue no legislative framework for the crypto industry until 2025, according to the Cardano founder Charles Hoskinson. 

LBRY recently gains a victory over the SEC

The district court recently clarified that the November ruling it gave in the LBC lawsuit where the SEC is the plaintiff and LBRY the defendant does not include the secondary market sales of LBC. This verdict comes after the SEC requested the district court judge for New Hampshire to issue an injunction that would restrict the sale of LBC.

Anyone enjoying themselves exchanging some non-securities on secondary markets today?

— LBRY (@LBRYcom) February 1, 2023

John Deaton, the attorney representing over 75k XRP holders in the prevailing Ripple vs SEC lawsuit, helped in this victory achieved by the LBRY team. Deaton played a major part as he explained clearly why LBC secondary market sales cannot be recognized as securities, presenting his facts before the judge.

Particularly, the founder of Crypto Law argued that the SEC failed to distinguish between the LBRY’s management, users, and the token. Deaton centered his arguments around previous lawsuits filed by the SEC, referring to a document written by Lewis Cohen, a  commercial contract attorney. In this paper, Cohen analyzed all the security lawsuits filed in the United States that emerged after the SEC vs. Howey lawsuit. 

John Deaton noted that the SEC lost all of these lawsuits as all the associated crypto assets didn’t fit into the security category but were seen as commodities by the court. It was after the court hearing of Deaton’s argument that the district court judge ruled that the order given in November does not include secondary market sales.

Ripple’s chances to win the SEC increases

Following this LBRY vs SEC case development, Ripple now stands a better chance at defeating the SEC in their two-year-long court battle over XRP. Several members of the XRP community have also shown their excitement toward the judge’s clarification on the LBC token sales. Attorney Jeremy Hogan noted that the SEC admitted on the record that the LBC token itself is not a security, applauding John Deaton for his expertise. 

Takeaways:

1. The @SECGov lawyers in the @LBRYcom case conceded OTR that secondary market sales of $LBC tokens do not constitute a security.

2. No one fights harder for the crypto community than @JohnEDeaton1. Imagine how easy the SEC would have it if it weren’t for him? https://t.co/ad9xOGDfeN

— Eleanor Terrett (@EleanorTerrett) January 30, 2023

Meanwhile, a certain member of the XRP community noted that the recent outcome counters the SEC’s claims on XRP, adding that it could force the U S. securities watchdog to settle with Ripple Labs and its two executives. But John Deaton who had earlier expressed assurance that the XRP lawsuit would not end just like the LBC lawsuit also stated that there will be no settlement in the Ripple-SEC case but a court ruling.

Meanwhile, Ripple CEO Brad Garlinghouse who disclosed that the XRP lawsuit would be around mid-2023 pinpointed what could make Ripple agree to a settlement with the SEC.

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The post How LBRY’s Recent Win Against the SEC is Reviving Hope in the XRP Community  appeared first on Times Tabloid.

A New Hampshire judge ruled on Monday that LBRY violated securities laws by selling its native token LBC without registering with the SEC.

Reacting to the ruling via its official Twitter handle, LBRY wrote, “We lost. Sorry everyone.”

Read Also: Why the SEC Won’t Win Ripple in the XRP Lawsuit, Attorney Jeremy Hogan Explains

According to LBRY, although the loss is painful, the blockchain still has a bright future and the team will not stop building, believing that the best is yet to come.

LBRY tweeted, “We’re going to lick our wounds for a little bit but we’re not giving up. We’ve got a bright team, tens of millions of pieces of content, hundreds of thousands of creators, and one of the most popular web3 apps in the world. The best is yet to come.”

We're going to lick our wounds for a little bit but we're not giving up.

We've got a bright team, tens of millions of pieces of content, hundreds of thousands of creators, and one of the most popular web3 apps in the world.

The best is yet to come

— LBRY (@LBRYcom) November 7, 2022

The blockchain firm further said that the language used in the summary judgment makes virtually all cryptocurrencies in the United States a security, including the second-largest crypto Ethereum (ETH).

“The language used here sets an extraordinarily dangerous precedent that makes every cryptocurrency in the US a security, including Ethereum, “LBRY added.

In March 2021, the SEC filed a lawsuit against LBRY, alleging that LBC tokens were securities and that the firm had violated securities laws by selling them without registering with the agency.

In response to the allegation, the startup claimed that LBC tokens were not securities and that the SEC did not give it fair notice that its sale of LBC was subject to securities laws, resulting in the violation of its right to due process.

In favor of the SEC, Federal Judge Paul Barbadoro ruled that “Because no reasonable trier of fact could reject the SEC’s contention that LBRY offered LBC as a security, and LBRY does not have a triable defense that it lacked fair notice, the SEC is en t it led to judgment. The SEC’s Motion for Summary Judgment is granted, and LBRY’s Motion for Summary Judgment is denied.”

Read Also: Firm Has No Financial Relationship with Ripple, But Ready to Support Its Fight against the SEC

Should Ripple Worry Over XRP Securities Status?

Actually, LBRY’s loss to the SEC really didn’t hurt many investors. The embattled LBC token is the 796th largest cryptocurrency by market cap. The highest trade it recorded on a given day was around $10,000. Although many investors are not hurt, one or two people would still be at loss due to the outcome of the case.

On the other hand, Ripple, the San Francisco-based cross-border payment firm, is also at loggerheads with the SEC in a case similar to that of LBRY. And the loss has certainly sent a message to Ripple’s camp.

Unlike LBRY, the XRP community is huge. There are numerous XRP holders. This implies that a loss would have a massive impact on the crypto industry.

The strategy the SEC used to win against LBRY is also being applied by the agency against larger crypto projects, such as XRP. With the Ripple case winding down, one must wonder whether the ruling is a boost to the SEC’s argument.

Going by the ruling document, the securities watchdog was able to convince the court that LBRY completed an unregistered securities offering by selling its LBC token.

Read Also: Blockchain Association Legally Joins Ripple and XRP in the Fight against the SEC

It’s certain that the victory is a big one for the SEC, which uses the Howey Test in most of its crypto lawsuits.

Over the past weeks, many companies within and outside the crypto industry have come out to support Ripple legally through amicus briefs. So far, 12 companies, including Coinbase, have formally supported Ripple and the teeming XRP community members now anticipate the end of the lawsuit.

Things seem to be working in favor of Ripple in recent weeks, but what could the significance of the recent SEC victory be? Does the SEC now have a leg to stand on in the Ripple case? Could the Howey Test be used to label XRP as a security as well?

According to LBRY as aforementioned, the language used by the judge sets “an extraordinarily dangerous precedent that makes every cryptocurrency in the US a security, including Ethereum.”

In these last days of the XRP lawsuit, anything can happen. So, Ripple should learn from LBRY’s loss for the future of the crypto industry.

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The post The SEC Beats LBRY in Final Ruling Using Howey. Should Ripple and XRP Worry? appeared first on Times Tabloid.