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Ripple v. SEC: Vocal Crypto Advocate John Deaton Shares One Condition for Settlement

Thu, 02/23/2023 - 09:45
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Godfrey Benjamin
Attorney John Deaton hinges conditions of settlement on SEC changing its claims about XRP
Ripple v. SEC: Vocal Crypto Advocate John Deaton Shares One Condition for Settlement
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As the ongoing legal brawl between blockchain payments firm Ripple Labs Inc and the United States Securities and Exchange Commission (SEC) draws to a close, questions surrounding a settlement between the two is now taking center stage in the discourse. In a recent tweet, popular crypto advocate and attorney John Deaton shared a key condition that may aid a swift settlement between both parties, should the option arise.

Taking to his favorite platform, Twitter, Deaton said he is confident that the company's lawyer will advise a settlement if the SEC agreed in writing that the ongoing and future sales of XRP are not securities. In his words:

If the SEC agreed in writing ongoing and future sales of #XRP by @Ripple are NOT sales of securities AND also agreed that secondary market sales of #XRP by any person or entity (ie exchanges) will NOT be sales of securities, I’m confident 10/10 lawyers advise settlement.

Ripple May 'Walk Through Door and Slam It Shut' in SEC Case, Ripple CTO Says

This comment was made in response to a question from a Twitter user seeking to get the lawyer's opinion on whether Ripple will agree to a settlement on demand that the Hinman Email is kept private.

Will SEC give up its core argument?

Hitting a settlement might present a win-win scenario for both the SEC and Ripple, however, the cost might be negatively skewed on the part of the regulator. The core argument of the Gary Gensler-led commission is that the sale of XRP was an unregistered security, and declaring in writing that this is not so might reduce the regulator’s credibility in the broader financial ecosystem.

Ripple v. SEC: Prominent Forbes Journalist Files Amended Motion to Obtain Hinman Documents, Here's Why

The SEC has a number of likely lawsuits it is possibly eyeing, including those involving Kraken and Paxos Trust. The precedent that will be set with that of Ripple will be very vital in future enforcement actions and will make the regulator think twice before arriving at a settlement.

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About the author

Godfrey Benjamin is an experienced crypto journalist whose main goal is to educate everyone around him about the prospects of Web 3.0. His love for crypto was birthed when, as a former banker, he discovered the obvious advantages of decentralized money over traditional payments. With his vast experience covering various aspects of Web3, Godfrey's articles has been featured on, Cryptonews and Coingape, among others.