A major ruling in a recent court case against the Ripple payment protocol company and creator of the XRP cryptocurrency token has the entire cryptocurrency community celebrating a win this week. In the case set forth by US Securities and Exchange Commission, Ripple was being sued on allegations of breaching U.S. securities law in moving to sell XRP without first registering it with the agency. A New York judge decided that XRP does not constitute a securities transaction, except for in institutional transactions, marking a major win for clarification of whether or not cryptocurrencies qualify as securities.
The verdict of the Ripple case was announced this week, as reported by CNBC. It marked the end of a three year legal battle between Ripple and the SEC, and was notably among several cases that the SEC had brought against various crypto exchanges and developers. The judge ultimately ruled that Ripple’s XRP was “not necessarily a security on its face.”
This ruling could have major implications, not just for Ripple and its XRP token, but for much of the cryptocurrency market. In particular, the SEC has been in a legal battle with Coinbase as well for allegations of selling unregistered securities on its platform. The verdict for Ripple gave Coinbase leadership confidence that it will come out ahead in its legal battle as well.
“For exchanges, for tokens that are listed on exchanges, for regular investors, there’s no question that this ruling strikes a blow to the idea that somehow securities are being traded when people go onto exchanges and trade the assets,” Coinbase Chief Legal Officer Paul Grewal told CNBC. “I think we will win. Now, I thought we would win before this decision. We think this decision has only further strengthened the case.”
Cryptocurrency values were up across the board following Ripple’s win in court. It will remain to be seen how further court cases play out, but it looks like a big win for Crypto exchanges and investors this week.