Ripple v. SEC case update as of May 1, 2023

The ongoing legal dispute between blockchain firm Ripple and the Securities Exchange Commission (SEC) continues to drive uncertainty in the crypto community regarding which party will come out on top and the overall impact on the industry. Adding to the drama is the speculation surrounding when presiding Judge Annalisa Torres will deliver the summary judgment.

In this line, Ripple has recently commented on the potential summary judgment date in its Q1 2023 quarterly report. While Ripple anticipates that the matter will be resolved sometime this year, the company recognized that it ultimately remains up to the court to make that decision.

Initially, speculation was that the case could be resolved by the end of Q1 2023. However, pro-XRP lawyer John Deaton has suggested that interested parties keep an eye on May 6, as he predicts that a summary judgment will be delivered on that date. This adds to the prediction by Ripple CEO Brad Garlinghouse, who expects the case to be summed up in the first half of 2023. 

In the quarterly report, Ripple also highlighted that one of the SEC’s expert opinions on the “reasonable expectations of XRP purchasers” was stricken from the court record, along with another SEC expert opinion on determining the cause of XRP price changes. 

This move is significant for the ongoing legal battle as it narrows down the issues that will be considered in the summary judgment.

Ripple hits out at SEC regulatory approach 

Furthermore, Ripple has criticized the US regulatory approach to the crypto industry, stating that the focus has been on regulation by enforcement instead of clear rules. The company cited examples of enforcement actions, including the SEC issuing Wells Notices to Coinbase and Paxos rather than creating regulations.

To provide background, in December 2020, the SEC sued Ripple and two of its executives, Chris Larsen and Brad Garlinghouse, for allegedly offering unregistered securities in the form of XRP. 

The SEC has faced criticism for its lack of clarity on what it considers security, with the ongoing Ripple case expected to bring more clarity. Despite repeated questioning, Chair Gary Gensler has yet to provide a definitive answer, including on the status of Ethereum (ETH). 

For context, Ripple is currently seeking the unsealing of the Hinman speech documents, which may shed light on how the SEC initially classified digital assets.

Impact on Ripple business

It is essential to mention that the ongoing legal proceedings are expected to have a possible impact on Ripple’s business and on-chain metrics. However, despite this uncertainty, Ripple has maintained strong on-chain activity in the year’s first three months. 

In fact, transaction volumes increased by 9% to 116 million, compared to 106 million in the previous quarter. Additionally, decentralized exchange (DEX) volumes surged 34% to $115 million compared to the previous quarter.

Meanwhile, by press time, XRP was trading at $0.46 with daily losses of over 2% in the last 24 hours. Over the last seven days, the token has held slight gains of 0.6%.