• A pro-Ripple lawyer has ruled out any near-term impacts from the SEC’s appeal in the high-stakes legal battle.
• The attorney claimed that even if the appeal is made now, it will take at least two years for a second-level court to make a decision.
• He also highlighted that even if Judge Torres’ application of the third criterion of Howey Test is flawed, she could still apply the other two criterion to the case which would be difficult to satisfy.
Near-Term Impacts From SEC Appeal Ruled Out
Pro-Ripple lawyer John E Deaton rejected any threat to XRP in the near-term even if the SEC goes ahead with its appeal in the high-stakes legal battle. The attorney said that, regardless of what happens with the appeal, District Court Judge Analisa Torres’ ruling will be legally binding for at least two years. He also claimed that even if courts find fault with her application of Howey Test’s third criterion, they may still fail to win a judgment as Judge Torres could apply other two criteria instead.
What Is The Howey Test?
The Howey test is a legal test used to determine if a transaction could be considered a security. According to this test, a transaction is considered as a security when: (1) there is an investment of money; (2) in a common enterprise; (3) with an expectation of profit; and (4) derived from efforts of others. In this case, Judge Torres ruled that sale of XRP did not meet all four criteria and thus should not be viewed as securities.
SEC’s Displeasure With Ruling
The verdict set a precedent regarding crypto regulation in U.S., but according to Bloomberg report, SEC publicly expressed its displeasure regarding some portions of this ruling and signaled intent to have them reviewed. This has caused much debate among stakeholders regarding whether or not XRP should be regulated as securities or not.
Lawyer’s Arguments Against Appeal
Deaton took Twitter to express his views on how Ripple [XRP] could avoid being affected by any potential review from higher courts on Torre’s ruling – he stated that it would take at least two years for such decisions, so until then Torre’s ruling will remain legally binding on all parties involved. Furthermore, he argued that even if flaws are found within her application of third criterion of Howey Test –Torres can still apply other remaining criteria which would be more difficult for SEC to satisfy and win their argument against Ripple [XRP].
It remains unclear whether or not Ripple [XRP] will face repercussions in future due to SEC’s potential review on Judge Torre’s ruling – however it seems highly unlikely for near future due various arguments raised by Pro-Ripple Lawyer John E Deaton about complexities involved in filing appeals and proving arguments against Ripple [XRP].