Wednesday, March 3, 2021

Lawyers Explain Reasons Why Ripple Should Settle Rather Than Head to Head with SEC in Court

Many members of the cryptocurrency community have been coming with the suggestion that Ripple should settle the case out of court. They think it would be difficult for Ripple to go head to head with the United States Securities and Exchange Commission (SEC) in the court.

In this regard, two lawyers have also thrown their weights behind settlement as the only headway for Ripple in the case.

Read Also: Names of Ripple, Garlinghouse, and Larsen’s Attorneys for the Suit Filed by SEC Released

In the latest episode of the “Unlimited” podcast hosted by journalist Laura Shin, lawyer Stephen Pally averred that the lawsuit filed by SEC against Ripple is likely not going to the Supreme Court:

Stephen Pally noted:

“I think that the case ultimately has to be settled. I don’t see it going up to the Supreme Court. If they take it up to the Ninth Circuit, they will probably lose… If I were gonna take a case to change the law and to change how we look at digital assets, this isn’t the one that I would take because they are not sympathetic.”

Why Is SEC Nailing Ripple?

The United States accused Ripple, the payment firm that oversees the distribution of XRP, of selling about $1.3 billion worth of unregistered securities illegally.

Read Also: A New Pro-Crypto SEC Chairman Appointed. Would This Favor Ripple and XRP?

According to the second lawyer on the show, Gabriel Shapiro of BSV Law, if Ripple Labs were a public company, Section 16 (b) report would have been filed with the SEC for such huge sales, exactly the way Tim Cook does with his Apple shares.

Gabriel Shapiro said:

“All of those protections that a typical investor in a typical security would have, XRP holders were deprived of. So, If XRP is a security, you can see how they lose out, relatively speaking, by not having this kind of disclosure…”

Adding that “There was some possibility of bringing a fraud case. It’s just much harder…Why would it muddy the waters by bringing a weaker claim when it doesn’t have to?”

Palley, who was part of the discussion, stated that the digital token XRP rose notably to nearly $0.7 around the time Ripple was drafting its Wells letter. The huge rise met a significant plummet following the news of the lawsuit.

Read Also: United Kingdom Provides Regulatory Clarity for Digital Asset, Says XRP Is Not A Security

According to Shapiro, the judge that presided over Kik and SEC’s case was not persuaded by the argument that KIN was a currency, which differentiates Kik’s case from Ripple’s current lawsuit with the SEC.

In a nutshell, the two lawyers are trying to buttress nearly the same point. They are unanimously advising Ripple not to go too far in the ongoing case.

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Solomon Odunayo
Solomon has a growing passion for writing, this propelled him to keenly work on Eagles News Media for about two years before delving into the cryptocurrency and Blockchain industry he finds more interesting. He worked as a crypto Journalist and Editor at NewsLogical before joining Herald Sheets, owing to the priceless experience he has accumulated since he became a contributor in the crypto community.

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