SEC Leverages Ripple Ruling in Binance Legal Battle
  • The SEC is using the Ripple case ruling as a supplemental basis for its lawsuit against Binance.
  • Judge Hamilton’s objective ruling on XRP’s Third Howey Test Phase sparks controversy.

The United States Securities and Exchange Commission (SEC) has added a new twist in its ongoing legal battle with Binance using the recent ruling in the Ripple class action lawsuit. The legal opinion of a California district court judge differs significantly from that of a Southern District of New York (SDNY) judge who found that XRP is not a security, but the SEC is acting accordingly.

SEC Files Ripple Lawsuit as Supplemental Authority to Binance Lawsuit

In supplemental jurisdiction, the SEC recently filed a class action lawsuit against Ripple in the District of Columbia. The SEC alleges that its ongoing lawsuits against Binance, Binance.US, and former CEO Changpeng Zhao are related to arguments in Ripple’s complaint and the judge’s ruling.

This development comes as most of the discovery disputes in the Binance litigation have already been resolved as the discovery and testimony period nears its end. The joint motion to dismiss is one of the motions the lawsuit is currently awaiting a court decision on.

The trial, which Judge Hamilton presided over, dismissed most of the plaintiffs’ securities violation claims in favor of Ripple Labs, Inc. The trial is set to proceed despite Ripple CEO Brad Garlinghouse making false claims about the sale of XRP.

Garlinghouse responded by saying he was confident and willing to provide further details during the trial, and that the sole plaintiff also noted that he may not have heard the statements in question prior to the transaction and did not purchase XRP directly from Ripple.

Ongoing discussions and SEC strategies

The XRP community is in a frenzy following Judge Hamilton’s decision to overturn the SDNY court’s conclusion that programmatic sales of XRP are not securities. In a sobering ruling on the third element of the Howey test, the court noted that programmatic purchasers may have expected to profit from Ripple’s efforts.

Meanwhile, the SEC is also focusing on Garlinghouse’s allegedly misleading statements about XRP. Ripple’s main concern is that the SEC may use the California case in its Second Circuit appeal of Judge Torres’ summary judgment on XRP, which hinges on whether sales of XRP constitute a security.

Meanwhile, according to data from CoinMarketCap, the price of XRP is $0.4853 At the time of writing, 0.87% In the past 24 hours, XRP 1.22% It has been showing a bullish trend throughout the past seven days.

This price movement comes against a backdrop of more general market uncertainty and legal ambiguity surrounding Ripple. Prior to this, CNF covered the key issues raised by Ripple’s Stuart Aldeloti regarding the SEC’s recent decision, specifically the unresolved status of Ether as a security.

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