The United States Securities and Exchange Commission (SEC) has hinted at the possibility of pushing for an appeal on the latest XRP ruling that declared the digital currency sold on secondary marketplaces non-security. Speaking on the proposed plan, XRP holders' lawyer, John Deaton, believes that the markets regulator will have to do a lot to prove the most crucial part of the Howey Test, which is the third factor.
Deaton reiterated that the Court holds that a common enterprise agreement existed between Ripple Labs Inc. and institutional investors. He pointed out that no extension was given per this clause as it concerns retail investors and the involvement of the firm's named executives, Brad Garlinghouse and Chris Larsen.
READ FOOTNOTE 13 PEOPLE:— John E Deaton (@JohnEDeaton1) July 22, 2023
"The Court holds only that a common enterprise existed between Ripple and the Institutional Buyers. The Court does not reach the question of whether the common enterprise extends to encompass "other XP holders." Defendants Garlinghouse and Larsen, the… https://t.co/uQO0q4M6sT pic.twitter.com/VwX4jyChSf
In his projections, if the SEC becomes successful in appealing the ruling from Judge Analisa Torres, all that will happen is a remand. He also believes that "Judge Torres will likely decide the SEC failed to prove the common enterprise factor between Ripple and XRP holders in the secondary market."
When the ruling was passed, the SEC expressed satisfaction with the institutional aspect but claimed the retail verdict was a wrong one, shrugging off any potential settlement option. John Deaton pointed out the inconsistency in the theories of the SEC throughout the proceedings, which made the commission change its common enterprise theory on three different occasions before deciding that the XRP coin itself is the common enterprise.
The projection is already indicating a potential hazy journey ahead for the SEC, and should it appeal, the timeline for the final settlement of the case will be significantly elongated.
Celebration while there is time
The Ripple community was agog following the news of the XRP ruling, a trend that sent the price of the crypto and the broader market to new highs. This massive growth was fueled by the bouts of XRP relisting by top exchanges like Coinbase and Kraken.
Pending when the SEC will appeal the case and a possible ruling will be delivered, members of the XRP community may need to relish the current moment.