Ripple Labs secured a significant victory in the US District Court for the Southern District of New York on July 13. Judge Analisa Torres ruled partially in favor of the company in a case brought by the Securities and Exchange Commission (SEC) that dates back to 2020 . The court granted summary judgment in favor of Ripple Labs, stating that XRP tokens are not securities and can only be sold on digital asset exchanges for programmatic purposes.
However, the SEC also achieved a victory as the judge ruled that XRP qualifies as a security when sold to institutional investors, meeting the criteria outlined in the Howey test. The SEC's lawsuit aims to compel Ripple to cease offering XRP tokens, arguing that they should be subject to additional regulatory oversight due to their classification as securities. The court's decision grants summary judgment in favor of Ripple regarding programmatic sales, other forms of distribution, and sales made by executives Larson and Garlinghouse, but denies it for ins institutional sales.
Following the news, the price of XRP experienced a rapid surge from $0.45 to $0.61. At the time of writing, the token price has risen by over 25%. The case against Ripple has been ongoing since December 2020, when the SEC sued the company and its CEOs, Brad Garlinghouse and Chris Larsen, alleging that they had engaged in the sale of unregistered securities.
The litigation surrounding Ripple has been filled with dramatic twists, including the release of the "Hinman Papers" and ongoing legal disputes involving Garlinghouse and the SEC. The crypto community appears to be jubilant in response to the news, as the movement of the XRP token reflects the positive sentiment generated by the court's ruling.
