The United States Securities and Exchange Commission (SEC) faced a setback in its attempt to overturn a recent courtroom defeat against Ripple Labs. U.S. District Court Judge Analisa Torres reaffirmed her decision on Tuesday.
Judge Torres previously ruled in July that Ripple’s direct sale of cryptocurrency tokens to consumers didn’t qualify as an unregistered securities offering.
The SEC’s appeal failed to demonstrate significant flaws in the initial ruling. This ruling marks another small victory for Ripple. A positive market response with its XRP token increased by 6.8% before stabilizing at $0.53.
But the SEC won’t back down
Despite this setback, the SEC still has the option to appeal after the case concludes following a trial on remaining issues scheduled for next April. The SEC had hoped to address what it considered significant legal challenges created by Judge Torres’ decision through this appeal. This case has drawn extensive attention as it challenges the SEC’s stance on many cryptocurrency companies engaging in illegal securities activities.
Judge Torres, in her July verdict, emphasized that Ripple’s XRP token doesn’t inherently classify as a security. Following this decision, the crypto market experienced significant growth, with a $73.5 billion increase and a total market capitalization of $1.3 trillion, along with XRP surging by over 66%.
