Yesterday, a day of no particular importance during the depths of a brutal bear market when crypto has been kicked around by seemingly everyone, the steeple bells peeled in goblin town.
On Thursday, the news spread quickly across Crypto Twitter, Slack, Discord and Telegram that a federal judge of the vaunted United States District Court for the Southern District of New York had reviewed the U.S. Security and Exchange Commission’s (SEC) years-long case against Ripple Labs and determined that it fell short in many respects.
Bill Hughes is the director of global regulatory matters at ConsenSys.
When the SEC publicly commented on the historic decision, it put on the bravest face it could muster. The agency puffed that the court agreed with its claim that heavily negotiated contracts for XRP tokens between Ripple and various institutional investors were securities under the “Howey test,” and that Ripple had fair notice that those contracts needed to be registered with the SEC to be lawful. Ripple’s interpretation of Howey was also expressly rejected by the court, the SEC sniffed, and the agency would “continue to review the decision.”
This carefully drafted pat-on-the-back contained so much spin that the SEC’s public affairs office must remain nauseous even today.
See also: Ripple Labs Ruling Throws U.S. Crypto-Token Regulation into Disarray | Opinion
The SEC, tellingly, elided everything in the decision that is clearly damaging to the SEC’s current approach to crypto. The SEC undoubtedly knew immediately how big a debacle this decision is for them, and what a boon it is to not just the legal position but also spirit of an industry that the SEC has sought to crush under its well-polished wingtip since the condemnable implosion of FTX.
A welcome surprise
One wonders how surprised the SEC Division of Enforcement and chairman were at this decision, and what their first thoughts were. Was it possibly remorse about choosing to drop years-long discussions with the industry in favor of scorched earth litigation? About not pursuing a legislative or rulemaking approach? About actually litigating a strategically critical case to the end rather than doing whatever it takes to settle?
Whatever their thoughts might have been, their surprise was surely no less than that of the broader crypto…
Click Here to Read the Full Original Article at Cryptocurrencies Feed…
