Ripple CLO Tells ‘Biggest Story’ Regarding XRP

Ripple’s CLO Stuart Alderoty emphasizes that the biggest crypto story of 2023 occurred when Judge Analisa Torres ruled that XRP is not a security.

With the end of 2023 around the corner, people across different sectors have been recounting some major events that occurred this year.

SEC Chair’s Worst Loss

Notably, Ripple Chief Legal Officer (CLO) Stuart Alderoty joined the challenge, highlighting the biggest crypto story 2023. In a tweet yesterday, Alderoty stated that the biggest crypto story of 2023 involved SEC chair Gary Gensler suffering his worst loss.

According to Alderoty, Gensler suffered his worst loss when Judge Analisa Torres, the judge in charge of the SEC’s legal battle against Ripple, ruled that XRP in itself is not a security.

Biggest crypto story of 2023: Gary Gensler suffered his “worst loss” when Judge Torres ruled that XRP is not a security.

“Judge Analisa Torres ruled that the asset [XRP] today no longer qualifies for securities regulation. This was SEC chair Gary Gensler’s worst loss, coming on… https://t.co/ad0JGLFUPG

— Stuart Alderoty (@s_alderoty) December 20, 2023

Alderoty remarked while quoting excerpts from an article published by popular media outlet Axios. The Axios article, which highlighted some big crypto stories of 2023, noted that the most significant part of Judge Torres’ ruling about XRP is that crypto assets themselves no longer qualify for securities regulation as of today.

Axios described the court’s decision as Gensler’s worst loss because it addressed “the biggest legal issue for digital assets: How the government categorizes these instruments determines how freely they can trade in the U.S.”

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In its quick take, Axios pointed out that a higher court could overturn Judge Torres’ ruling. However, the media outlet asserts that it is hard to imagine that the U.S. cannot find a way to cohabit with people dealing with new digital assets.

Ripple V. SEC Legal Duel

The Ripple lawsuit is one event that crypto enthusiasts, especially XRP holders, will not forget in a hurry. For nearly three years, the SEC claimed that XRP was an investment contract – a special type of security.

In December 2020, the regulator alleged that Ripple violated the law by offering XRP as an unregistered security to U.S. investors.

Contrary to the SEC’s claim, the court ruled that XRP, the coin’s programmatic sales, and other distributions do not qualify as securities. Meanwhile, it found that Ripple’s direct past XRP sales to institutional investors constitute an investment contract.

Although the SEC attempted to file an interlocutory appeal to challenge the decision on Ripple’s programmatic sales and other distributions, it did not have an issue with the court’s declaration about XRP.

In the meantime, the case is in the remedies stage as the parties will be engaged in another lengthy litigation. The upcoming legal duel, which is set to commence in February 2024, will determine the appropriate penalty Ripple could pay for violating the by selling and offering XRP to institutional clients.

The final motion in the remedies phase will be filed by the SEC on April 29, 2024. After the submission, the court will review all remedies-related motions and evidence before issuing its final judgment.

Once the penalty phase is over, the spotlight will be on the SEC, as its decision could determine whether the lawsuit will head to the Second Circuit or end in a settlement.

The regulator had already signaled its intention to appeal the federal court’s summary judgment. However, the SEC could settle with Ripple and put an end to the multi-year legal duel.