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Concerns of a potential appeal by the United States securities regulator to the landmark Ripple ruling earlier this month were shrugged off by Ripple’s chief legal officer Stuart Alderoty.
Alderoty believes if the SEC takes the case to an appeal, the court could move to consolidate Ripple Labs’ partial victory over the financial regulator even further.
Speaking on a July 26 TechCrunch podcast, Alderoty reiterated his position that the XRP (XRP) token does not constitute an investment contract and that the Ripple team would not “shy away” from any appeal brought to the courts by the SEC.
“We think the judge got that right, and we think that was a faithful application of the law, and I think a court of appeals will not only affirm that but maybe even amplify that to even a greater extent.”
On July 13, Judge Analisa Torres ruled XRP was not a security when sold to the public on crypto exchanges but can be treated as a security when sold to institutional investors.
On July 21, the SEC used its ongoing case against Terraform Labs founder Do Kwon to air out its grievances with the ruling and hinted that it would appeal the split-decision ruling in the future.
“Respectfully, those portions of Ripple were wrongly decided, and this Court should not follow them,” SEC lawyers wrote, asserting that retail sales of XRP should have been deemed securities.
“SEC staff is considering the various available avenues for further review and intends to recommend that the SEC seek such review,” the lawyers added.
SEC Chair Gary Gensler also expressed his disappointment over the court’s decision on XRP adding the regulator would continue to assess the ruling.
Related: Ripple CEO Brad Garlinghouse: ‘The SEC created this mess’
In light of the ruling, Alderoty predicted if the SEC continues to claim that crypto assets themselves are securities it would begin to lose ongoing cases where the SEC attempts to make such claims.
“Our case and the decision rendered by our judge [Torres] will provide comfort to other judges that the SEC is just misguided.”
Despite his optimism, Alderoty warned the crypto sector is still a long way away from standing on solid regulatory ground. He condemned the SEC’s regulation by enforcement approach for causing crypto laws in the U.S. to fall well behind other jurisdictions.
“We still need a rational, comprehensive and understandable regulatory framework for crypto in the U.S.,” he said. “Because of the SEC’s refusal to faithfully apply the law […] the U.S. has been visibly falling behind the rest of the world.”
Currently, XRP is changing hands for around $0.70, up nearly 43% in the last month, according to Cointelegraph data.
Magazine: Crypto regulation — Does SEC Chair Gary Gensler have the final say?
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