Ripple and the XRP community have been waiting for the verdict in yesterday’s LBRY lawsuit.in the judgment of the court issued On Tuesday, July 11th, a lawsuit between the Securities and Exchange Commission (SEC) and decentralized content sharing platform LBRY Inc. was concluded.
The LBRY team announced the final judgment on Twitter, stating that it will completely dissolve LBRY Inc. in accordance with the court order. They also emphasized that the future of LBRY is now in the hands of the community. However, the impact of this ruling has raised concerns about its potential impact on Ripple and the digital asset XRP.
Could a similar outcome occur in the Ripple case?
Lawyer Jeremy Hogan, known for his involvement in the XRP community, said: share His insight into the LBRY incident and its potential impact on Ripple. He noted that the court’s ruling in the LBRY case did not address the secondary sale or material issue doctrine. Instead, he focused on “banning and fines for further violations.”
Hogan suggested that the ongoing Ripple case could have similar consequences. However, he outlined two key conditions that must be met in order to issue an injunction against Ripple. First, the court must find that the fair notice defense is insufficient to justify trial on this issue. Second, the court must determine that both past and current sales of XRP qualify as investment contracts.
If these conditions are met, injunctive relief could pose a significant challenge to Ripple, as it would limit sales from escrow. Nonetheless, Hogan noted that there could be workarounds, although they could hamper Ripple’s business plans.
Regarding the impact of the LBRY decision on the market, Hogan characterized the lack of ruling on secondary market sales as a “status quo” decision. He expressed doubts about Coinbase relisting XRP based on the ruling, but he also did not expect other exchanges to delist their digital assets.
Hogan also expressed disappointment that the judge failed to respect the SEC in the final paragraph and fully understand the turmoil spreading in the market.
In conclusion, this ruling (and indeed this lawsuit) offers little market guidance and “protects” no one. In fact, it hurt everyone involved. It’s just another feather in the SEC’s hat. that’s all.
better than nothing
Lawyer John E. Deaton, another prominent figure in the XRP community, also said: weighed Regarding the LBRY judgment. Deaton emphasized the court’s request to make it clear to the judge that the token itself is not a security, similar to the previous Telegram ruling. But the judge, voicing judicial restraint, refused to do so on the grounds that the particular issue had not been litigated.
As such, Judge Deaton expressed disappointment with the judge’s cautious response, but also acknowledged that the judge’s decision specifically excluded the application of an injunction to secondary market listings. He viewed this as a positive aspect because it would prevent the SEC from falsely claiming that the ruling also applies to secondary sales. Deaton said:
However, the SEC cannot argue that his decision applies to the secondary market. It’s better than nothing.
The final judgment in the LBRY case issued by Judge Paul Barbadoro permanently barred and injunctive LBRY from violating Section 5 of the Securities Act. This includes selling securities or participating in unregistered cryptocurrency securities offerings without a valid registration statement. LBRY also has to pay the SEC a $111,614 civil penalty.
At the time of writing, XRP has managed to break out of the 200-day EMA and is trading at $0.4753.
![XRP price ripple](https://bitcoinist.com/wp-content/uploads/2023/07/XRPUSD_2023-07-12_07-28-41.png)
Featured images from Yahoo Finance, charts from TradingView.com