In the on-going case of Ripple vs. the U.S. Securities and Exchange Commission (SEC), last week, the SEC refused to produce documentation on Bitcoin and Ethereum. They argued that the request is irrelevant to this case.
However, Ripple Labs filed a response letter with magistrate judge Sarah Netburn, requesting the SEC submit the documentation requested.
The SEC filed a lawsuit against Ripple in late December alleging the firm, and two key executives had sold XRP tokens, which they consider unregistered securities.
Much has happened in the three months since then. Especially in terms of damage to XRP’s price and desertion by key partners and exchanges. However, as the case has gone on, the price of XRP has recovered, to some extent, from its $0.18 low.
As things stand, there are four main motions in this case. The first is to compel the discovery of documents relating to CEO Garlinghouse and Chairman Larson’s financial information. Second is the SEC’s motion to strike Ripple’s fair notice defense. The third is Garlinghouse and Larson’s motion to dismiss the lawsuit against them. And finally, Ripple’s motion on why it took the SEC seven years to bring legal action.
Yesterday’s response letter filing could bring additional complexity to this case. The law firm representing Ripple says documentation the SEC holds on Bitcoin and Ethereum is relevant because they are comparable with XRP.
In June 2018, former SEC Director William Hinman gave a speech in which he gave Bitcoin and Ethereum the green light; “when I look at Bitcoin today, I do not see a central third party whose efforts are a key determining factor in the enterprise. The network on which Bitcoin functions is operational and appears to have been decentralized for some time, perhaps from inception.
And putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.”
Ripple’s legal team wishes to know whether there was a perceived equivalency among the primary digital assets. If so, on what basis is XRP being singled out?
Attorney Jeremy Hogan offered his opinion on this latest twist by saying he would be shocked if the judge did not uphold the response letter.
Hogan added, depending on the content of the documents, the SEC could be at fault for “knowledge of wrongdoing.”
As the case has gone on, Ripple’s legal arguments have become all the more convincing. The question is, will Judge Netburn consider Bitcoin and Ethereum relevant to Ripple’s case?
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