By Brenda Collins
In a recent report, Attorney John Deaton has expressed his skeptical stance on the possibility of a settlement in the ongoing case between Ripple Labs and the US SEC. Moreover, the SEC’s chairman, Gary Gensler, has recently pointed out a broader regulatory clampdown on the crypto industry. Meanwhile, US Senator Elizabeth Warren introduced a new bill to battle crypto misuse in illicit activities, setting heightened regulatory targets.
John Deaton, the lawyer representing XRP token holders in the current legal battle between Ripple Labs and the United States Securities and Exchange Commission (SEC), has cast doubts concerning the two warring parties agreeing to a settlement deal. He made the observation at a time when crypto companies are facing intense scrutiny from the SEC under its current chairman, Gary Gensler’s administration.
Attorney Deaton Doubts A Settlement Deal
The lawsuit started when the SEC accused Ripple Labs of selling XRP tokens, which was considered an unregistered security, and since then, it has become a focal point in the crypto community. In his opinion, Attorney Deaton stated that the SEC considering a settlement deal in the case against Ripple would be perceived as a weak stance, especially given that the commission is also enforcing regulations on many other crypto firms.
His opinion was reportedly birthed due to the SEC’s aggressive enforcement approach towards firms in the crypto industry and the multiple legal cases the commission is involved in. Moreover, the outcome of the lawsuit between the SEC and Ripple Labs has far-reaching consequences for the crypto industry, making it the most closely monitored case in the community. Furthermore, the report revealed that the current legal brawl between the two parties is centered in the broader context of regulations in the US and globally.
Also read:Deaton Referenced Senator Warren’s Bill in Ripple Context
Attorney Deaton pointed out that a recent bill which Senator Elizabeth Warren proposed to mitigate the abuse of crypto assets in illicit activities like sanction breaching, drug trafficking, and money laundering. The SEC’s aggressive approach as well as the Senator’s bill reportedly depicts a growing trend of intensified regulatory clampdown in the crypto industry.
In addition, Deaton also likened Ripple’s case with the Morrison Vs. the Supreme Court case, stating that the ruling in the case affirmed that the oversight powers of the SEC are limited to the US. This ruling could be vital in deciding the case against Ripple considering the fact that Ripple’s XRP tokens sales were executed outside the United States.
Moreover, Judge Analisa Torres gave a summary judgment in favor of Ripple in July, stating that the tokens were sold to retail customers. Nonetheless, the crypto community awaits the final verdict. According to reports, the outcome of the case is much anticipated by the entire crypto community because it would have a significant impact on the crypto market in the US and globally.
Ripple-SEC Lawsuit Has Huge Impact On Crypto Global Market
For instance, in June 2023, the SEC accused Coinbase exchange of selling unregistered securities. However, Coinbase filed a counter charge to dismiss the case, which if successful, the SEC’s stance in Ripple’s case would be hugely debased. However, whatever the result of the lawsuit is, whether it ends in a court decision or a settlement deal, it is much anticipated to create a way for a clearer regulatory framework for digital assets in the US. The clarity is essential and important for other digital assets firms and token issuers to comply with the regulations to avoid scrutiny.
Furthermore, the case between the SEC and Ripple Labs is very pivotal to the crypto ecosystem, as evident in the massive numbers of investors and firms, as well as regulatory agencies closely following the development of the case across the world. This is because the result of the case could serve as a precedent for how the United States securities regulations treat crypto assets, affecting the future interactions, growth, and adoption of cryptocurrency in the region.
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