SEC claims XRP holders’ intention to intervene is motivated by doubling Ripple price


  • The Securities & Exchange Commission urged the court to disallow XRP holders from intervening in the Ripple case.
  • Ripple suggested that there could be a role for XRP holders even if the intervention gets rejected.
  • Attorney John Deaton claims that other cryptocurrencies could be on the line if the SEC highlighted XRP as a speculative investment.

Following last week’s intervention attempt by attorney John E. Deaton on behalf of over 10,000 XRP holders in the US Securities & Exchange Commission (SEC) v. Ripple case, the two parties’ response has shed new light on the future of cryptocurrencies in the country.

SEC claims intervention could cause complexity and confusion

After being denied the same motion two weeks ago, attorney Deaton refiled his letter to intervene in the lawsuit, representing over 10,000 XRP holders this time. According to attorney Deaton, Ripple’s lawyers suggested that there could be a role for XRP holders even if the intervention in the case gets rejected. 

In a March 26 letter to Federal Judge Analisa Torres, Jorge G. Tenreiro, senior trial attorney at the SEC, urged the court to prevent XRP holders from intervening in the SEC v. Ripple case. The SEC cited an XRP investor, Vladi Zakinov, who filed a class-action lawsuit against the blockchain company in June 2018 who would need to join the case with other crypto holders who claim the token was sold as an unregistered security. 

The SEC further argued that by allowing Deaton and the XRP holders he represents to intervene in the case, this would cause an “avalanche” of claims and “near certainty of due delay, complexity, and confusion.” 

While the SEC is claiming that an avalanche of people would be able to intervene in the case if the court ruled in favor of the XRP holders, Deaton claims that only three other people have sued Ripple and that no class-action has been certified. 

Although Deaton has not spoken to Ripple or its lawyers regarding the latest developments, Ripple’s lawyers emphasized that their position is conditional based on the SEC’s response. So far, Ripple has taken a neutral stance on the issue but claims that the regulator needs to clarify the ambiguity of whether the lawsuit would affect the secondary XRP market.

Deaton never claimed to have lost money on XRP

According to Deaton, if cryptocurrency exchanges ask the SEC for clarity based on what was said at the discovery hearing that took place on March 20, he is confident that the securities regulator would issue no-action letters to allow XRP to be relisted and traded. He highlighted that the SEC did not seek a preliminary injunction to stop Ripple from selling its tokens and added:

There is nothing stopping Ripple from selling #XRP to fund operations. If the SEC informs the exchanges that they can trade #XRP and #XRP doubles from here, Ripple has twice the money to defend the case and, yes, legal fees are considered operational expenses.

Citing a previous FXStreet article, the SEC argued that Deaton’s intention behind the intervention is to double XRP’s price after cryptocurrency exchanges “reinstate speculative trading” of the digital asset. However, attorney Deaton stated in a January tweet that excluding the suppression in price due to the SEC filing, he has “never even claimed to have lost money on XRP.”

The lawyer highlighted the “absurd claim” that some XRP holders bought the digital asset as a speculative investment, which “proves” that Ripple sold XRP as an investment contract. Citing the SEC’s objection to his pre-motion letter, attorney Deaton further hinted that the Ripple case is a threat to all cryptocurrencies, highlighting that other digital assets, including Bitcoin and Ether could also be speculative investments according to the SEC. 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

Bitcoin adoption accelerates as coiling prices hint at explosive rally

Bitcoin price faces a stiff resistance wall that has prevented weak bullish momentum from passing through. As a result, a short-lived retracement has caused a majority of the market to follow suit despite BTC’s raging adoption and interest from institutions over the past week.

More Bitcoin News

VeChain upswing thwarted again as sell signals multiply

VeChain price shows an ambiguous outlook as it has set up a textbook uptrend with a series of higher highs and higher lows, but technical indicators hint at a downtrend.

More VeChain News

Judge reaffirms order SEC must produce documents on Bitcoin, Ether and XRP in Ripple case

Judge Sarah Netburn has restated that the Securities and Exchange Commission (SEC) must produce documents related to Bitcoin, Ether, and XRP amid the ongoing legal battle with Ripple Labs.

More Ripple News

Polkadot Price Prediction: DOT hints at minor retracement before resuming its rally

Polkadot price shows a slowdown in its bullish momentum that has resulted in sellers taking over. Now, a minor retracement could push DOT into a significant support barrier.

More Polkadot News

BEST CRYPTO BROKERS/EXCHANGES




Bitcoin Weekly Forecast: Markets revert to mean, but BTC price remains indecisive

Bitcoin price shows considerable strength after springing from the recent crashes. Still, it is uncertain whether the current bullish impulse will morph into a new uptrend or lead to a more profound decline.

Read the weekly forecast

BTC

ETH

XRP