As was earlier suspected, the United States Securities and Exchange Commission (SEC) plans to seek an appeal in court for Judge Analisa Torres’ verdict on its case with Ripple, which ruled that the sale of XRP is not a security when sold to retail investors and therefore, shows no violation of federal securities laws.
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This comes nearly one month after the U.S. District federal judge presiding over the lawsuit in Manhattan pronounced the ruling in July and in all of this time, SEC Chair Gary Gensler has been quiet until now.
Judge Torres Approached to Halt Case Pending Appeal
Based on the SEC’s letter to Judge Torres, the commission has requested that the federal appeal court be made to review her July 13 decision on XRP classification. The regulator is confident that an appeal will address legal issues on which there was “substantial ground for differences of opinion.”
Hence, Judge Torres is expected to suspend the case while the appeal takes place. This is because the SEC fears that several other pending cases may be affected by the decision from the appeal court.
SEC Sues Binance And Coinbase Over Securities Violations
It is suspected that the U.S. watchdog might be referring to its enforcement actions on Binance and Coinbase, the two cryptocurrency exchanges caught in its lair over alleged securities violations.
In asking that the ruling be reviewed while the case is pending, the SEC highlighted “Interlocutory review is warranted here,” and “These two issues involve controlling questions of law on which there is substantial ground for differences of opinion as reflected by an intra-district split that has already developed.”
SEC Says All Crypto But BTC is Security
It is worth noting that the judge’s verdict is a major setback for the SEC in its efforts to supervise the cryptocurrency industry.
For many years, the commission has adamantly claimed that all crypto but Bitcoin (BTC) are securities and as such, it is in its jurisdiction to regulate the nascent industry. As a result, the U.S. SEC sued Ripple, its Chief Executive Officer (CEO) Brad Garlinghouse and the co-founder Chris Larsen in December 2020.
According to the SEC, these entities made a profit worth almost $1.5 billion from the sales of XRP, which is allegedly unregistered securities. The lawsuit had lingered for more than two years until July 13th when Judge Torres ruled otherwise, stating clearly that XRP is not security.
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