XRP Lawsuit Update As of April 2, 2024: Judge Torres Ripple Ruling At Risk

The uncertainty surrounding the XRP lawsuit is increasing as the legal battle nears its end. The decision of the Judge in a separate lawsuit between Coinbase and the U.S. Securities and Exchange Commission (SEC) is seemingly in contrast with the decision in the Ripple vs SEC case.

Charles Gasparino (@CGasparino), Senior Correspondent at Fox Business, raised concerns regarding the long-term viability of the Ripple ruling from July 2023 where the court determined that non-institutional XRP sales were not securities offerings.

He highlighted comments from Judge Katherine Polk Failla in the Coinbase case, which appeared to contradict the legal reasoning applied by Judge Analisa Torres in the Ripple case.

Failla’s decision emphasized that established legal frameworks for identifying securities apply to cryptocurrencies. This directly challenged the applicability of Judge Torres’ ruling as a precedent for XRP’s classification. Notably, Failla dismissed arguments from Coinbase that attempted to leverage the Ripple ruling in its defense.

Ripple Ruling Under Scrutiny

Gasparino further pointed out that Judge Failla, in her ruling, referenced a separate decision by Judge Jed Rakoff in the case of SEC vs. Terraform Labs. Similar to Failla, Rakoff also rejected the legal analysis presented in the Ripple case.

These developments have sparked discussions within the crypto community regarding the possibility of overturning the Ripple ruling by appellate courts. Despite a prominent legal expert’s opinion that the SEC will not appeal the decision, SEC Chair Gary Gensler has shown an unwillingness to budge on matters of cryptocurrency regulation, including his view of Ethereum (ETH) as a security, which adds another layer of complexity. Gensler’s position suggests the SEC will challenge Judge Torres’ ruling.

Is This the End of XRP’s Regulatory Clarity?

The legal debate has drawn strong reactions from the XRP community, as Legal representatives associated with Ripple have countered the emerging narrative.

Jesse Hynes criticized the attempt to directly translate the outcome of the Coinbase case, which involved a motion to dismiss, to the Ripple case, deciding on a summary judgment motion. He argued that such comparisons are legally unsound and demonstrate a misunderstanding of the legal nuances.

Similarly, lawyer Bill Morgan challenged Gasparino’s claims of widespread judicial skepticism towards Judge Torres’ decision. He requested specific references from court decisions to substantiate these claims.

The contrasting outcomes in the Ripple and Coinbase cases have introduced significant uncertainty regarding the future of XRP’s classification. XRP has not reacted in an overwhelmingly negative way, and analysts still believe it will go up, with one analyst predicting a 60% surge in 9 days.

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Tobi Loba

Tobi Loba is a passionate writer with a vast interest in the stock market. She joined the crypto ecosystem about three years ago and has written lots of ebooks and articles in relation to cryptocurrency and blockchain projects. Tobi Loba earned her degree at the University of Ibadan.