The conclusion of Ripple Labs’ legal struggle with the U.S. SEC may be in sight. The solution is a veritable treasure trove of emails and other communications authored by erstwhile SEC Corporate entity Finance Division Director William Hinman, a well-known lawyer and crypto enthusiast.
Ripple Gets “Real Leverage” Thanks to Hinman Documents
A settlement in the acrimonious XRP securities case between the SEC and Ripple may be made soon.
The possession of such William Hinman emails by Ripple, a cryptocurrency payments company based in the United States, provides it “real leverage,” according to attorney Bill Morgan. If the matter goes to trial, the SEC won’t be able to keep these documents secret, which is what they will want to do. As a result, the commission can be tempted to settle to avoid being seen by the public.
The documents in question concern former SEC official William Hinman who gave a market-moving speech in 2018 declaring that Ethereum was not a security because, like bitcoin, it was “sufficiently decentralized.”
While some could claim that perhaps a Ripple and SEC lawsuit has been a potential, Morgan suggested that it is highly likely given the favorable circumstances for a settlement agreement.
When asked how likely Ripple’s response to the SEC’s statement on the summary judgment motion would include Hinman’s email as an exhibit, the attorney responded that it was possible that this response would be among the essential records in the case.
Will SEC Probably Lose Bombshell Lawsuit?
In December 2020, well before Chairman Gary Gensler assumed leadership of the securities agency, the SEC brought a claim against Ripple. The SEC said in its fiery lawsuit that the sale of Ripple’s cryptocurrency, XRP, constituted a securities offering and unregistered investment contract.
As a result of Ripple’s and the hundreds of thousands of tiny investors who own XRP’s commitment to resist, the SEC will soon suffer a bitter reckoning. This commitment was made nearly two years ago.
Before this, eminent legal experts, including Rhode Island attorney John Deaton concurred that the Security and Exchange Commission (SEC) would prefer to settle with Ripple than to have the Hinman documents admitted into evidence. Stuart Alderoty, the general counsel at Ripple, has clarified that if the SEC rules that XRP does not meet the criteria for securities, the company will quickly settle and pay a punishment.
Following a few significant procedural victories the blockchain payments company has achieved in recent months, most experts believe the SEC is headed for a humiliating loss against Ripple. If Ripple prevails, the decision may drastically curtail the SEC’s ability to control cryptocurrencies in the United States, setting a significant precedent for the cryptocurrency industry.