Ripple, the firm behind the cryptocurrency XRP, is celebrating the decision by the United States Securities and Exchange Commission (SEC) to drop a court case against them. However, this victory doesn’t supply the much-needed broader legal clarity for the cryptocurrency industry. Ripple and industry enthusiasts regarded the case as a characteristic example of the SEC’s potentially overstretched authority under former chair Gary Gensler.
Ripple CEO Brad Garlinghouse acknowledged this as a significant win that brings Ripple “a lot of certainty”. He added that while the case is practically settled, the firm needs to address some remaining issues with the SEC. Additionally, Stuart Alderoty, Ripple’s chief legal officer, declared that the landmark case has paved the way for the domestic crypto industry.
Nevertheless, despite the victory and Ripple’s optimism, the outcome of this case does not establish a legal precedent, nor does it lay down the much-called-for regulatory framework for the crypto industry.
Market reaction was swift to Ripple’s announcement at the Digital Asset Summit in New York, and the price of XRP soared 9% within the hour. Many followers and industry advocates highlighted the potential implications of the case for the broader crypto industry. However, legal experts maintain that the final impact of the SEC’s appeal decision remains unclear.
Despite the ongoing legislative efforts to establish regulations for the crypto industry in the US, the Ripple case’s conclusion holds limited sway over the broader lawmaking process. Experts echo that the responsibility lies with Congress, not the SEC, to make lasting legislative changes to regulate the cryptocurrency industry. Unless such legislation is executed, the crypto market faces potential legal risks from district courts. The entire industry thus eagerly awaits further regulatory clarity following the developments in the Ripple case.