The Securities and Exchange Commission (SEC) dropped charges against Ripple executives, including CEO Brad Garlinghouse.
The agency filed lawsuits against Ripple in 2020 under former President Donald Trump. Current SEC chair Gary Gensler continued them, but a court ruled in July that Ripple’s XRP (XRP-USD) crypto was not a security when traded on public markets, thus not subject to SEC regulation.
In response, the value of XRP rose 7%. Early this morning, XRP was trading at about 52 cents, a market capitalization of $27.6 billion. Trading volume over the previous 24 hours more than doubled to $1.77 billion.
Ripples Never Come Back
The SEC’s letter to Judge Analisa Torres says the agency will meet with Ripple executives over the issue of its sale of coins to institutions.
Torres ruled in July that sales of about $600 million in Ripple on public exchanges were not unregistered security offerings. She ruled sales of $728.9 million of XRP to hedge funds and other sophisticated buyers violated the law.
But Garlinghouse and Larsen say the new letter completely vindicates their position that Ripple is not a security and thus is not under the agency’s control. Garlinghouse called the agency’s actions “baseless allegations from a rogue regulator with a political agenda.”
Bitcoin (BTC-USD) prices also rose in sympathy, with traders predicting quick approval of a Bitcoin ETF. Bulls expect the price of the leading cryptocurrency to quickly rise above $30,000 and continue higher. Bitcoin was still trading at $29,661 as this was written, up 4.18% in 24 hours, the market cap at $578 billion.
XRP Crypto: What Happens Next?
Ripple still faces unresolved issues. These could result in up to $700 million in penalties, and legal action to collect some or all of that continues. The SEC could also appeal Torres’ decision on public sales.
As of this writing, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
