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“I’m hopeful with Gary Gensler and the new chair likely to be confirmed in a couple of weeks. There’s an opportunity to have a conversation with that new leadership as he brings his team in.”
We are 10 days ahead of Gary Gensler’s Senate confirmation vote to be chairman of the Securities and Exchange Commission. This event may produce changes to the outcome of the SEC vs Ripple lawsuit.
Brad Garlinghouse, Chief Executive Officer of Ripple Labs, has been again vocal against the former head of the SEC, Jay Clayton, for his timing on filing the complaint against Ripple Labs and its founders, Brad Garlinghouse and Chris Larsen.
”As you may know and may recall, J. Clayton as the chair of the SEC, the day before he left office, brought this lawsuit against Ripple and against me personally. You know we don’t think that made a lot of sense given that XRP had been trading for eight years. And so, to do that the day before he leaves his position, I think it was misguided”, Mr. Garlinghouse told Bloomberg.
“I’m hopeful with Gary Gensler and the new chair likely to be confirmed in a couple of weeks. There’s an opportunity to have a conversation with that new leadership as he brings his team in.”
Gary Gensler is said to be more open-minded towards cryptocurrency and he did make positive comments about Bitcoin in the past.
In the SEC v. Ripple lawsuit, the court has most recently rejected the SEC’s attempt to deny the motion put forth by XRP holders who asked to intervene. The motion will be filed as well as for responses from the SEC and Ripple.
The SEC argued that “if the Court permitted Movants to intervene, all other XRP holders, including a large class of XRP investors who has already sued Defendant Ripple Labs, Inc. (“Ripple”) for unregistered offers and sales of XRP securities, would likely seek to intervene, too. Intervention would thus create an “avalanche” of claims and “near-certainty of undue delay, complexity and confusion”.
Attorney noticed ‘bombshells’ dropped by Judge
FinanceFeeds has recently reported on Attorney Jeremy Hogan’s comments regarding a recent court session, where the Judge dropped a “bombshell”.
“My understanding about XRP is that not only does it have a currency value but it has a Utility and that utility distinguishes it from Bitcoin and Ether”, which may suggest she does not view it as a security.
The Judge also questioned the SEC attorney that, based on his theory, “everyone who sold XRP – including you and me – are selling illegal securities”. The SEC lawyer said, “no, under Section 4, only Ripple and affiliates of Ripple can have sold XRP illegally”.
This statement from the SEC lawyer clears the way for the cryptocurrency exchanges in the United States to re-list XRP again with no fear of reprisal.
The lawsuit against Ripple alleges co-founders aided and abetted Ripple’s unregistered sales of securities, dating as far back as 2013 and 2015 respectively.
In its answer, Ripple stated it had “never offered or sold XRP as an investment” and that “XRP holders do not acquire any claim to the assets of Ripple, hold any ownership interest in Ripple, or have any entitlement to share in Ripple’s future profits.”
Ripple stuck with the SEC while central banks look for the perfect ledger
The SEC vs Ripple lawsuit may hamper the firm in the race for CBDCs. Ripple has recently released a white paper making its case for the XRP private ledger as a bridge for central bank digital currencies.
It is unclear if Ripple is addressing central banks with its white paper as a way to put pressure on the ongoing legal battle with the SEC. Either way, central banks may hesitate to work with Ripple at this particular time.
More so if they lose the case and the firm becomes overwhelmed with private legal claims. Too much uncertainty to deal with while competitors get in line for attention from central banks, including R3’s Corda, Ethereum, Stellar, Hedera, and eftpos.
Ripple, though, has already got France’s attention and the European Central Bank is planning to launch the digital euro within the next five years. ECB’s Panetta has proposed a threshold of €3,000 for every citizen.
The creator of the XRP ledger can still get around the legal issues and work with central banks by setting up a separate company or subsidiary. Being open-source, the ledger can always be used by any interested party, but without the privacy settings offered in its recently announced CBDC Private Ledger.
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