The Ripple Saga: A Quick Recap
The ongoing saga between Ripple and the SEC began in December 2020 when the SEC charged Ripple for what it claimed was an unregistered securities offering of XRP tokens. Ripple has staunchly denied these allegations, asserting that XRP doesn’t meet the necessary criteria set out in the Howey test, which determines whether a transaction qualifies as a security.
The Footnote That Stole the Spotlight
Fast forward to May 2023, and attorney John Deaton drops a bombshell on Twitter regarding a seemingly innocuous footnote found in Ripple’s opposition brief. According to Deaton, this footnote hinted at internal discussions at the SEC about whether XRP qualifies as a security. It stated:
“There are reasonable grounds to conclude that XRP does not satisfy all elements of the Howey Analysis and is therefore not a ‘security’ for purposes of the federal securities laws.”
Why Does This Matter?
Internal deliberations among SEC officials are pivotal. If they show that the SEC questioned whether XRP was a security, it could sway the ongoing lawsuit. The SEC initially argued that XRP should be treated like unregistered stocks, but internal debates could drive a wedge into that argument. As Deaton puts it, this footnote points to disagreements within the SEC about XRP’s status—information we’ve been waiting to hear for years.
Connecting the Dots
Deaton notes that while the SEC remained tight-lipped on this matter publicly, the footnote brings to light what many in the XRP community have felt all along—that XRP has been a topic of internal discussions at the SEC. In fact, Deaton speculates that the statement referencing XRP’s status was likely sourced from an external party, echoing what many XRP holders believed all along.
What’s Next?
As the legal battle continues, Ripple and the SEC are both keeping an eye on June 13, a date that promises to unveil more details about the Hinman documents. These revelations could either validate or undermine the SEC’s case further. As we await this pivotal moment, one must wonder: Is it the calm before a storm, or just more of the same legal dancing?
