In a significant turn of events, the legal battle surrounding Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has taken a new dimension. While all eyes have been on the Ripple case, prominent XRP lawyer John E. Deaton has asserted that the recent ruling on Coinbase’s motion to dismiss holds more significant implications for the cryptocurrency industry.
The “Torres Doctrine” Shaping the Landscape
The legal saga, officially known as “SEC v. Ripple Labs,” has seen Judge Torres ruling that XRP sales conducted on cryptocurrency exchanges and by Ripple executives should not be classified as securities—a precedent now known as the “Torres Doctrine.” This ruling has set a vital precedent for the classification of digital assets.
Coinbase’s Motion to Dismiss Takes Center Stage
In the wake of Judge Torres’ pivotal summary judgment in the Ripple vs. SEC lawsuit and amidst a backdrop of proposed crypto regulations by U.S. lawmakers, Coinbase has made a bold move by filing a motion to dismiss the SEC’s lawsuit. Coinbase’s argument centers on the assertion that the SEC lacks jurisdiction and has not obtained oversight approval from the U.S. Congress.
John E. Deaton’s Perspective
John E. Deaton, a staunch advocate for XRP and a leading legal voice in the cryptocurrency space, has emphasized the significance of Judge Failla’s impending ruling on Coinbase’s motion to dismiss. Deaton firmly believes that Judge Failla will likely adopt the Torres Doctrine and grant Coinbase’s motion to dismiss regarding token sales. However, he speculates that the SEC’s complaint pertaining to staking may still be permitted to proceed. Deaton suggests that should Judge Failla align with the Torres Doctrine, a settlement between Ripple and the SEC becomes a more likely outcome.
Furthermore, Deaton has argued that many legal experts are underestimating the potential for Coinbase to prevail against the U.S. SEC, stressing that such a victory would carry immense importance for the cryptocurrency industry. A partial victory for Coinbase would establish a precedent indicating that token sales on the platform are not securities. This development would contribute to regulatory clarity within the crypto space, potentially increasing the chances of approval for a spot Bitcoin Exchange-Traded Fund (ETF).
Broader Observations on SEC Actions
Deaton’s views are not isolated, as they echo sentiments expressed by Coinbase’s Chief Legal Officer, Paul Grewal. Both Deaton and Grewal believe that the SEC’s interlocutory appeal is likely to be rejected. Federal judges and members of the U.S. Congress have increasingly voiced concerns over the SEC’s actions, with Senator Cynthia Lummis even urging the courts to dismiss the lawsuit. Such actions by the SEC have drawn criticism for being contrary to the interests of Congress and potentially impacting other regulatory bodies.
XRP Price Remains Resilient
Meanwhile, amid the legal turmoil, the price of XRP continues to demonstrate resilience. At the time of writing, XRP is trading above the $0.50 support level, reflecting a 1% increase over the past 24 hours. The daily price range for XRP has fluctuated between $0.500 and $0.512.
As the legal battle unfolds, the crypto community remains watchful, anticipating the potentially far-reaching implications of both the Ripple and Coinbase cases on the broader regulatory landscape and the cryptocurrency market as a whole.
