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Ashley Prosper, a crypto enthusiast deeply engaged with XRP, sparked a conversation with a detailed Twitter post outlining various developments in the ongoing legal battle between Ripple Labs and the Securities and Exchange Commission (SEC).
She noted an important opinion from the 2nd Circuit Court stating that the SEC cannot force disgorgement without financial loss to investors. This principle could directly affect the SEC’s case against Ripple, where no clear financial harm to investors has been proven.
Prosper highlighted an unexpectedly scheduled settlement conference following the SEC’s failure to outline investor losses in their remedies and judgment brief. This conference also ran longer than anticipated. Amid these events, Ripple did not respond to the SEC’s brief before this sudden meeting was called.
Prosper mentioned several SEC actions affecting the broader crypto landscape in her roundup, including starting an investigation into Ethereum and sending a Wells notice to UniSwap.
She also pointed out major developments within Ripple, such as their announcement of stablecoin plans and the unscheduled unlocking of escrow funds, alongside legislative progress on stablecoin regulation in both the House and Senate.
In a separate tweet, Mr. Huber, another crypto expert, lamented that despite what some might consider good news, XRP had plummeted by 70% against other cryptocurrencies. According to Huber, a settlement during a bull market could harm every retail investor involved, suggesting that “good news” is not always beneficial.
Yesterday, Ripple’s Chief Legal Officer Stuart Alderoty referred to a recent setback for the SEC in the Aron Govil case, where the 2nd Circuit rejected the SEC’s appeal. Alderoty believes this decision reinforced that without financial loss, the SEC’s claim for disgorgement holds no water—a favorable signal for Ripple.
Lawyer Bill Morgan echoed this sentiment. He pointed out that the Govil case’s outcome could bode well for Ripple, especially if institutional investors are found not to have suffered financially.
Morgan stressed that Ripple could leverage this to their advantage if the SEC fails to prove financial harm. However, he cautioned that the outcome remains uncertain, pending further responses from Ripple to the SEC’s allegations.