Deaton’s involvement in the LBRY case as an Amicus Curiae representative has sparked curiosity and speculation regarding the potential connections and impacts that this new development could have on the outcome of the XRP lawsuit.

Read Also: Ripple CTO Responds to LBRY-SEC Case Ruling, Points Up Certain Victory Despite Lack of Clarity

This move signifies Deaton’s participation in the case on behalf of Naomi Brockwell, the founder of Crypto Law, a platform focused on analyzing legal and regulatory developments in the crypto space.

#XRPCommunity #SECGov v. #Ripple #XRP In the @LBRYcom appeal, @JohnEDeaton1 has filed his Notice of Appearance on behalf of Amicus Curiae Naomi Brockwell. pic.twitter.com/wbE0nNMmFm

— James K. Filan (@FilanLaw) September 14, 2023

Deaton’s involvement in the LBRY case demonstrates his dedication to fighting for the rights of crypto token holders and his continued efforts to explore legal avenues that may have implications for the XRP lawsuit.

Potential Connections and Ramifications

The LBRY lawsuit, which resulted in a ruling stating that LBRY violated securities laws, initially raised questions about its potential impact on the XRP case. However, U.S. District Judge Analisa Torres delivered a summary judgment in favor of Ripple in July 2023, deeming the XRP token sale to retail buyers as not constituting securities.

Despite this ruling, Deaton’s appearance in the LBRY case renews speculation about potential connections and implications that may arise from overlapping legal arguments, precedents, or regulatory interpretations between the LBRY and XRP lawsuits.

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

Paving the Way for New Legal Perspectives

John Deaton’s notice of appearance in the LBRY case introduces intriguing possibilities for the ongoing XRP lawsuit. As an advocate for XRP token holders, Deaton’s involvement brings fresh legal perspectives and potential insights that could impact the trajectory of the XRP battle against the SEC.

While it remains to be seen how this development unfolds, Deaton’s commitment to fighting for the rights of crypto token holders serves as a testament to the ongoing efforts to navigate the evolving legal landscape surrounding digital assets.

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In a recent development, David Schwartz, the Chief Technology Officer (CTO) at Ripple, joined prominent figures within the cryptocurrency community to share their reactions to the final ruling delivered by Judge Paul Barbadoro in the SEC v. LBRY case.

Amid the efforts made by attorney John Deaton to seek clarification from Judge Barbadoro regarding the non-security status of the LBRY Credit token (LBC), the judge ultimately declined their request. According to the Judge, the topic wasn’t litigated hence the need to exercise judicial restraint.

I asked the Judge to clarify that the token itself is not the security just as Judge Castel did in Telegram. He declined to do so because he said that specific issue wasn’t litigated and he believes in exercising judicial restraint. He wrote: “it suffices to say that merely… https://t.co/xR9AemS5Hq

— John E Deaton (@JohnEDeaton1) July 11, 2023

As anticipated, members of the cryptocurrency community, including attorney Deaton, expressed disappointment in the judge’s decision to refrain from deeming the LBC token a non-security.

Ripple’s CTO Finds Silver Lining in LBRY Case Judgment

Reacting to the development, Schwartz offered a unique perspective, considering Judge Barbadoro’s final ruling as a victory for LBRY native token holders. 

Schwartz believes that Judge Barbadoro’s ruling brings clarity to the situation by stating that the ordinary use of LBRY Credit (LBC) does not breach the imposed injunction. He wrote: “It’s at least a victory that it was made clear that ordinary use of the token doesn’t violate the injunction.”

Notably, the judge explicitly pointed out that the SEC did not argue that third-party holders of LBC could potentially violate the proposed injunction. Consequently, the judge concluded that users who acquire LBC tokens for consumptive purposes should not be subject to regulatory restrictions.

It's at least a victory that it was made clear that ordinary use of the token doesn't violate the injunction.

— David "JoelKatz" Schwartz (@JoelKatz) July 12, 2023

Attorney Deaton echoed Schwartz’s sentiment, particularly regarding the judge’s conclusion that users can continue utilizing the LBC token without fear of legal repercussions.

The Overall Implication

On the whole, the LBRY case continues to be closely watched by industry participants, as it holds broader significance for the classification and regulatory treatment of digital assets.

While the ruling did not definitively settle the issue of LBC’s security status, Ripple CTO and attorney Deaton find encouraging aspects that shed light on the rights of ordinary users and the potential limitations of regulatory oversight in certain circumstances.

Recall that the SEC recently filed a lawsuit against top exchanges Binance and Coinbase, alleging that several assets such as ADA, ALGO, MATIC etc are securities.

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The LBRY team took to Twitter to announce the final ruling, revealing their compliance with the court order to fully dissolve LBRY Inc. They emphasized that the future of LBRY now rests in the hands of the community. However, this ruling has raised concerns about its potential impact on Ripple and the digital asset, XRP.

Read Also: Ex-SEC Director: It’s Reasonable for Judge Torres to Lock Ripple’s XRP Escrow Permanently

Lawyer Jeremy Hogan, well-known for his involvement in the XRP community, shared his insights on the LBRY case and its possible implications for Ripple. He highlighted that the LBRY court ruling did not address secondary sales or the Major Questions Doctrine. Instead, it primarily focused on halting further violations and issuing a penalty.

Ripple and XRP Face Uncertainty as LBRY Judgment Sets Precedent

The recent LBRY case ruling has left Ripple and the XRP community on edge as they await their own judgment. On Tuesday, July 11, the court reached a decision in the case involving LBRY Inc., a decentralized content-sharing platform, and the Securities and Exchange Commission (SEC).

LBRY announced the final ruling on Twitter, stating that they will fully dissolve LBRY Inc. as per the court order. They emphasized that the fate of LBRY now rests in the hands of the community. However, this ruling has raised concerns about its potential impact on Ripple and the digital asset XRP.

The final judgement in SEC vs LBRY is out.

In accordance with the court's order and our promises, we expect to spend the next several months winding LBRY Inc. down entirely.

As to what happens to LBRY from here, well, that's up to you. pic.twitter.com/cU8O3nATT6

— LBRY (@LBRYcom) July 11, 2023

Lawyer Jeremy Hogan, who is closely associated with the XRP community, shared his insights on the LBRY case and its implications for Ripple. He noted that the LBRY court ruling did not address secondary sales or the Major Questions Doctrine. Instead, it focused on halting further violations and imposing penalties.

Read Also: Analyst Says Lawsuit Against Ripple Executives is As Good As Lost. Here’s why

Hogan suggested that a similar outcome is possible in the ongoing Ripple case, but he outlined two crucial conditions. First, the court would need to determine that the Fair Notice Defense is insufficient to warrant a trial. Second, the court would have to establish that both past and present sales of XRP qualify as investment contracts.

“In conclusion, this ruling (and indeed this case) provides little market guidance and has “protected” no one. In fact, it hurt ALL the people involved. It’s just another feather in the SEC hat. That’s all,” Jeremy Hogan said.

Conclusion

The LBRY case ruling has set a precedent for the ongoing SEC case against Ripple. The outcome of the Ripple case is still uncertain, but the LBRY ruling suggests that the SEC may be successful in its case. The Ripple community is anxiously awaiting their own judgment, hoping for clarity and a favorable outcome.

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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.

To clarify the first verdict issued last November, the United States District Court of New Hampshire recently ruled that the sale of LBC tokens on secondary marketplaces — centralized and decentralized cryptocurrency exchanges — does not constitute a security. Also, the presiding Judge did not issue an injunction to prohibit the sales of LBRY Credits (LBC) as requested by the Gary Gensler-led SEC.

Following this latest development, which greatly excited the crypto community and particularly sparked hope in the XRP camp, the digital content hosting blockchain LBRY called on Coinbase to relist XRP. In stating why the largest US-based centralized crypto trading platform and exchanges should consider relisting XRP, LBRY cited that the outcome of the LBC lawsuit has created a precedent. 

In a tweet shared a couple of hours ago, LBRY said, “Coinbase should relist XRP. Under the SEC vs LBRY standard, XRP sold by secondary holders is not a security.”

Coinbase should relist $XRP.

Under the SEC vs LBRY standard, $XRP sold by secondary holders is not a security.

— LBRY (@LBRYcom) February 1, 2023

Notably, Coinbase and other US-based exchanges delisted XRP after the SEC filed a lawsuit against the San Francisco–headquartered crypto solutions company, Ripple, in December 2020, for the alleged sale of XRP as an unregistered security.

As the Ripple-SEC expects a conclusion by mid-2023 and seems to be going in favor of the cross-border payment firm, XRP holders have been calling out on exchanges to relist the 6th-largest crypto asset by market capitalization.

While other U.S. trading platforms like Newton, a Canada-based crypto exchange relisted XRP last November, Coinbase is yet to but the XRP community continues to mount pressure.

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The post LBRY Calls On Coinbase to Relist XRP in Line with Latest Verdict: Details 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.

The defeat recently suffered by LBRY in the lawsuit filed by the United States SEC in early 2021, is widely seen as a serious threat to entire cryptocurrency firms in the United States.

According to Jeremy Kauffman, the founder of LBRY, the concluded SEC vs LBRY case establishes a precedent that threatens the entire US cryptocurrency industry. “Under the SEC vs LBRY standard, almost every cryptocurrency, including Ethereum and Dogecoin are securities. The future of cryptocurrency in the U.S. now rests in with an organization even worse than the SEC: the United States Congress,” he added. 

While some XRP proponents have demonstrated panic over the ongoing Ripple-SEC case following the LBRY development, John Deaton, the attorney representing over 75K holders of the XRPL digital token, remains hopeful that Ripple will scale through. However, he said the SEC will make a huge deal about the victory over LBRY to the judge presiding over the XRP lawsuit, Judge Analisa Torres. 

Although the Ripple-SEC lawsuit has some similarities with the LBRY-SEC case, given that both involve the violation of securities law according to the SEC, the popular attorney believes Ripple will have a different outcome. 

Deaton, who is also the founder of Crypto Law said that the final ruling of the LBRY-SEC case is a very bad decision, citing that it would be a total disaster for crypto projects if the yardstick (Howey test) used by the presiding judge was a law in the United States. He added, however, that the ruling of the LBC token case is just “one district judge’s interpretation of the law as applied to one specific case.”

The @LBRYcom decision is a very bad decision (it’s why I’ve been talking about this case for the last year) and it is true that if the reasoning utilized by the judge was the law in the United States it would serve a death blow. But it is NOT the law. https://t.co/dUfrooW6yp

— John E Deaton (220K Followers Beware Imposters) (@JohnEDeaton1) November 7, 2022

Related: The SEC Beats LBRY in Final Ruling Using Howey. Should Ripple and XRP Worry

John Deaton States Why the Ripple-SEC Case is Different

In a recent Twitter thread, John Deaton noted that the XRP lawsuit between Ripple, the San Francisco-based crypto solutions company, and the United States securities watchdog is quite different from the LBRY’s case hence, XRP proponents should not panic. 

First, he pointed out that attorneys of the peer-to-peer content distribution network failed to implore the district judge to differentiate between the secondary market and direct sales of the LBC tokens. In other words, LBRY’s lawyers did not contest Howey’s 2nd Prong requiring a common enterprise whereas, in the XRP case, the common enterprise topic is challenged by Ripple’s attorneys, Deaton noted. 

In the @Ripple XRP case, common enterprise is challenged. In fact, the SEC argued – incoherently – regarding the common enterprise. At first, the SEC argued Ripple was the common enterprise but when the SEC was forced to concede that #XRPHolders do not obtain a legal or financial

— John E Deaton (220K Followers Beware Imposters) (@JohnEDeaton1) November 7, 2022

The SEC which could not prove Ripple or the XRP ecosystem to be the common enterprise was forced to abandon its expert testimony and move for Summary Judgment instead.

“The SEC did what it always does when it doesn’t have a good answer: it focused on the token and claimed XRP itself is the common enterprise. The SEC literally claims that #XRP itself represents the common enterprise AND represents the investment contract with Ripple,” the founder of Crypto Law expanded. 

In addition, he noted that the SEC is asking the judge to substitute a “But For” test for the Howey Test. Attorney Jeremy Hogan previously explained why the SEC cannot win based on one element of the Howey Test which is the ‘expectation of profits based on efforts of others’ prong. 

“But for Ripple executives created the XRPL and XRP, there wouldn’t be a secondary market for XRP, therefore all XRP are securities, Deaton wrote to further buttress his point. Comparing LBRY is like comparing apples with oranges,” he concluded. 

The SEC’s argument in the Ripple case is very simple:

The SEC is asking the judge to substitute a “But For” test for the Howey Test. Of course, they don’t frame it that way but that is what they are doing.

— John E Deaton (220K Followers Beware Imposters) (@JohnEDeaton1) November 7, 2022

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The post Attorney John Deaton Explains Why LBRY Case Outcome Should Not Be Expected for XRP Lawsuit 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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