The company said the agency is “rushing to appeal” what it contends is a legal question that applies to every case involving digital assets while “the factual and legal procedural postures of other SEC enforcement actions are different”
Ripple Labs objected to the SEC’s request to appeal a federal judge’s ruling that crypto currency was not a security when sold to the public.
Ripple on Friday asked US District Judge Analisa Torres in New York to reject the Securities and Exchange Commission’s request. The firm said the agency is “rushing to appeal” what it contends is a legal question that applies to every case involving digital assets while “the factual and legal procedural postures of other SEC enforcement actions are different.” The Securities and Exchange Commission requires Torres’s authorisation to appeal her ruling as it was not a final judgment. The SEC is also seeking to put on hold its suit against Ripple for allegedly offering unregistered securities while the appeal is pending.
Torres’s ruling was widely hailed as a victory for the crypto sector, which has withstood efforts to categorize digital assets as securities subject to regulation. In her July 13 decision, Torres drew a distinction between sales of Ripple’s XRP token to institutional investors, which she said met the test for an investment contract under federal securities law, and sales to the public on exchanges. The Securities and Exchange Commission said the matter was suitable for immediate review as the eventual outcome could impact other cases involving crypto currency, including similar suits the regulator has brought against Coinbase Global Inc. and Binance Holdings Ltd.
The Securities and Exchange Commission noted that another Manhattan federal judge, Jed Rakoff, categorically dismissed Torres’s perspective in the SEC’s case against Terraform Labs and its founder Do Kwon, finding that the Terra USD token may certainly be a security when sold to retail investors. Ripple said in its Friday filing that there are vital issues that remain open before the case is concluded, such as whether its sales of XRP to institutional investors are outside the SEC’s authority. If the Securities and Exchange Commission is allowed such an extraordinary appeal, Ripple said, it will seek to challenge the judge’s finding that those sales were securities transactions.
