The SEC lawsuit against Ripple Labs is one of the oldest unregistered securities cases brought by the SEC on a cryptocurrency entity. Ripple Labs is no longer associated with the cryptocurrency project called XRP.
XRP is now the native coin issued by a dedicated and open-sourced project named XRP Ledger. However, the matter in the court is still pending since SEC prosecutors brought the charges against Ripple Labs executives.
The stakeholders in the case have been waiting for a ruling since 2019. The next hearing on this lawsuit is going to take place in the Southern District Court of New York. However, legal experts think that they have fined a new legal precedent in favor of Ripple Labs from the recent Voyager ruling.
During the ruling, the presiding Judge on that case, Michael Wiles, shed some light on the lack of legal grounds and ambiguous jurisdiction of the SEC towards cryptocurrency markets.
A few days ago, Coinbase CLO Paul Grewal made similar claims about the scrutiny of the SEC, much like Judge Wiles. Grewal said in a Twitter thread that, thus far, regulators have refrained from providing any legislative specification to classify cryptocurrencies as either stocks or commodities.
Therefore, there is no legal precedence if cryptocurrencies should be regulated by CFTC or SEC. He also argued that in the absence of any specified legal definition for cryptocurrencies, there is no clarity for crypto entities to specify which regulations should be applied.
He concluded the Twitter thread by claiming that US regulators have refrained from providing any legislative clarity even though these centralized cryptocurrency exchanges have been around for years. It is important to mention that Coinbase is also the first ever publically traded cryptocurrency enterprise.
Jeremy Hogan, who has monitored the Ripple Labs and SEC lawsuit since the beginning, has argued that this argument can topple resistance toward the Fair notice defense for Ripple Labs.
Ripple is Working with Other Enterprises to Defend Crypto Industry
Legal expert Hogan has claimed that Ripple can argue the lack of legal precedent by invoking the US Constitution about mandatory proof or legal basis for every legible criminal statute.
On the other hand, Ripple’s lead defense attorney John Deaton has claimed that he is assembling a host of companies that the SEC has tried to violate section 5 of the Securities Act.
He announced this new idea on his Twitter account. He also said that if the attorneys of Ripple Labs and LBRY communicated with each other, the results would be more fruitful.
He claimed that, at present, the government invoked a coup against the crypto sector, and we can deal with it by forming a united front.