Gary Gensler, Chairman of the U.S. Securities and Exchange Commission (SEC), addressed the XRP case and the recent verdict. A U.S. court ruled that the token is not a security, granting a win for payment company Ripple.
Related Reading: Ripple CEO Garlinghouse Takes On SEC, Calls Them A ‘Bully’ In Wake Of XRP Ruling
The SEC sued Ripple Labs in 2020, accusing the company of violating the regulator’s rules by selling XRP without registering it as a security. The outcome of this case is crucial for the crypto industry setting a precedent that could have consequences for years to come.
Gensler Disappointed Over XRP Case?
While addressing the National Press Club event, Gensler approved the court’s judgment about institutional investors. However, he openly expressed his disappointment with the ruling concerning retail investors. “We’re still looking at it and assessing that opinion,” Gensler said, signaling the SEC’s ongoing deliberation.
Regardless of the court’s ruling, SEC Chair Gary Gensler assured that the regulator’s mission to ensure compliance within the crypto industry remains “undeterred.” He stated that the SEC would persist in its efforts to bring enforcement actions and facilitate the registration of crypto firms, thereby maintaining the “industry’s integrity.” Gensler reiterated:
We’re going to continue to try to bring firms that may not be in compliance into compliance — without prejudging any one of them — and try to ensure that we protect the investing public.
Ripple Ruling – A Mixed Bag For The SEC And The Crypto Industry
As Bitcoinist reported recently, a federal judge in New York delivered a ruling regarding the status of Ripple Labs Inc.’s XRP token that has garnered significant attention. The judge declared that XRP was a security when sold directly to institutional investors under specific written contracts.
However, when the token was sold to retail investors on crypto exchanges, XRP was not deemed a security. The verdict has not classified such transactions as securities, causing a divergence in the token’s legal status based on the investor’s nature.
This differential ruling has evoked varied responses. The crypto community has interpreted this decision as a win for the industry, asserting that it could set a precedent for similar cases. In contrast, SEC Chair Gary Gensler has expressed his reservations about the court’s decision.
This regulatory saga has undoubtedly garnered the attention of investors, companies, and spectators within the crypto space. Particularly, the developments in this case and their resulting impact on the regulatory landscape of the crypto industry will remain under scrutiny.
Meanwhile, XRP, in the last 24 hours, has seen a slight retracement of 1.3% following its huge spike of more than 50% over the past week. This modest downturn is also reflected in its market cap. Over $1 billion has been wiped off in the same timeframe, bringing XRP’s market cap to a current $38.5 billion as of writing.
Featured image from CoinDesk, Chart from TradingView