#Ripple appeared to score a major win against SEC in court. On closer consideration, however, it turns out to be partial at most, and the decision left a lot of room for ambiguity. So what actually happened there if you want something more than headline takes…
To begin with, the court ruling states that Ripple illegally sold $728 million worth of unregistered securities via institutional sales of XRP (what’s this, by the way), and its co-founders should stand trial for that violations.
However, the ruling stated also that Ripple did not illegally offer $757 million worth of unregistered securities through programmatic sales of XRP [on exchanges to retail buyers] (so exchanges relist XRP already). Nor, according to this court decision, Ripple did not unlawfully offer other distributions of $609 million worth of XRP, such as bonuses and workers’ compensation.
So it’s a split decision, based primarily on how and to whom the tokens were distributed. The judge basically ruled that institutional sales of XRP were illegal but that programmatic sales and other distributions were not.
However, the motivation behind the decision also warrants attention. The judge effectively rejected the arguments on which Ripple’s defense was based:
SEC says it leaves the door open for appeal, but it can take a long time anyway. On appeal from either party, the trial will likely continue for another year or two. If the case reaches the Supreme Court, a final ruling could take many, many years.