Gary Gensler ‘disappointed’ in Ripple ruling regarding retail investors News ▸ US ▸ XRP ▸ Regulation
Gary Gensler ‘disappointed’ in Ripple ruling regarding retail investors
The SEC chair said the agency would review the opinion and continue working to bring non-compliant firms into compliance.
2 min read
Updated: Jul. 17, 2023 at 10:18 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
U.S. Securities and Exchange Commission (SEC) chair Gary Gensler recently voiced his dissatisfaction with a court ruling related to the XRP token, as reported by Bloomberg on July 17.
Gensler said that he is “disappointed” by Judge Analisa Torres’ declaration that sales of XRP tokens on retail exchanges did not constitute securities offerings. The judge ruled on July 13 that programmatic sales and free giveaways of XRP were not securities.
Conversely, Gensler said that he is content with the judge’s ruling regarding Ripple’s sales of the XRP token to institutional investors. Judge Torres ruled that, unlike retail sales, Ripple’s institutional sales were unregistered securities offerings. The company directly offered the asset to those investors via written contracts.
Gensler also suggested that his agency is reviewing the case’s outcome, as he stated the SEC is “still looking at it and assessing that opinion.”
He also made it clear that the SEC will engage with other firms. He said:
“We’re going to continue to try to bring firms that may not be in compliance into compliance — without prejudging any one of them — and try to ensure that we protect the investing public.”
Gensler made the above statements during an event held by the National Press Club, according to Bloomberg’s latest report.
XRP benefited from case outcome
The SEC originally sued Ripple in 2020, at which time it alleged that the company violated rules by selling XRP without undergoing securities registration. Ripple opted not to settle with the SEC and instead chose to fight the agency in court.
Following the favorable judgment for Ripple, the XRP token has seen a significant resurgence. Over the week ending July 17, XRP recorded a more than 50% gain, reinforcing its position as the fourth-largest asset by market cap.
Ripple CEO Brad Garlinghouse has also made positive statements about the outcome, while at least one exchange — Coinbase — has decided to relist XRP.
However, Ripple’s legal challenges may not be entirely resolved, with some speculation that the SEC may pursue further legal action despite its recent setback. According to former SEC member John Reed Stark, there is a possibility that the latest decision could be overturned.
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Mike Dalton
Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.
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The XRP Ledger is a decentralized cryptographic ledger powered by a network of peer-to-peer servers.
Ripple
Ripple is a US-based technology company which develops the Ripple payment protocol and exchange network using XRP, the digital asset native to the XRP Ledger.
Coinbase
Coinbase is a digital currency exchange and wallet service that allows individuals to buy, sell, and store digital currencies, such as Bitcoin, Ethereum, and Litecoin.
Gary Gensler is an American government official and former investment banker who President Joseph Biden nominated to chair the U.S.