Ripple CLO says XRP ruling bodes well for Coinbase, Binance SEC cases News ▸ US ▸ XRP ▸ Regulation
Ripple CLO says XRP ruling bodes well for Coinbase, Binance SEC cases
Stuart Alderoty discussed the broader impact of Ripple's victory against the SEC.
2 min read
Updated: Jul. 26, 2023 at 1:44 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Ripple CLO Stuart Alderoty said on July 25 that a ruling concerning the securities status of the XRP token could be relevant to other ongoing cases.
In mid-July, Ripple obtained a legal victory against the U.S. Securities and Exchange Commission (SEC). The ruling largely found that Ripple and its executives had not engaged in unregistered securities offerings of XRP, contrary to earlier SEC allegations.
Now, in an interview on TechCrunch’s Chain Reaction podcast, Alderoty has commented on how that ruling could impact two other ongoing cases that the U.S. SEC has initiated against Coinbase and Binance. Alderoty said:
“In our case, we have a clear statement that the trading of a digital token … does not make a contract for an investment, and therefore there’s no security …. I think that ruling will play well in the Coinbase case and … equally well … in the Binance case.”
Alderoty explained throughout the interview that Ripple’s ruling found that the relationship between sellers and buyers is central to securities cases. He asserted that the SEC will lose cases if it claims that assets are securities in their own right and said that the outcome means that the SEC does not have jurisdiction over exchange trades.
At one point, Alderoty stated:
“The SEC should not be shocked and surprised when they’re told that if something is not a security. They need to leave the conversation because they have no further role.”
Despite his optimism about the ruling, Alderoty said that he does not believe the SEC will end its attempts to regulate the crypto sector by enforcement. Specific to XRP, he acknowledged that the SEC could take further action related to institutional sales of XRP but said that this does not pertain to XRP’s status as a security. He also discussed the possibility of the SEC appealing other parts of the case, as previously reported.
Alderoty emphasized that crypto investors should have protection but said there are other ways for exchanges to engage in compliance.
Alderoty emphasized Ripple’s separation from XRP during the interview, stating that the company uses XRP but did not create or issue the token.
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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.
Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
