Ripple vs SEC: Saga Continues as SEC Files Appeal of Judge XRP Torres Ruling

The long-running court lawsuit between Ripple and the Securities and Exchange Commission (SEC) is far from over as the latter files an appeal to challenge Judge Torres’s ruling on the classification of XRP. This comes just a few days before the appeal deadline of October 7.

The crypto community has again been rocked with uncertainty following the SEC decision, as different industry experts, including Ripple executives, weigh in on the decision.

SEC Files Notice of Appeal

Earlier today, the SEC filed a notice of appeal to the United States Court of Appeal for the Second Circuit to challenge what was initially perceived as a victory for Ripple and the global crypto community. The appeal aims to reverse the 2023 ruling that declared XRP as non-security.

Recall that the SEC began the battle when it sued the blockchain giant company Ripple in December 2020 for allegedly offering unregistered securities in XRP and raising more than $1.3 billion through these sales. Since then, there have been back and forth between both entities and the case became one of the most closely-watched cases in the crypto community.

Judge Torres ruled in July 2023 that the secondary sales of XRP did not constitute security. This was a very crucial ruling as it helped in the classification of the Ripple native coin. However, in August 2024, the court ruled that the offering of XRP to institutional investors by Ripple’s founders constituted the sales of security.

Consequently, the court ordered Ripple to pay $125 million in civil penalty. This was interpreted as a partial victory for the regulatory watchdog, setting grounds for an appeal which was filed today.

Ripple Executives Reacts

Meanwhile, key figures in the Ripple camp have reacted to the SEC’s appeal decision. Particularly, the Chief Legal Officer of Ripple, Stuart Alderoty, described the move as “disappointing.” He noted that even though the move was expected, it only added fuel to an already “embarrassing” situation for the agency.

Alderoty emphasized that the SEC could have dropped the case a long time ago, rather, it has continued to “engage in litigation warfare against the industry.” Furthermore, he said that Ripple is evaluating whether to file a cross-appeal adding that the SEC’s lawsuit has been “irrational” and “misguided” from the beginning.

Brad Garlinghouse, Ripple’s CEO, also weighed in on the situation. In a post on X (formerly Twitter), he buttressed the point of irrationality on the side of the Commission stating that the agency would have moved on from the case if they were rational.

Garlinghouse added that the SEC has “lost everything that matters” and that his company and the broader crypto industry have already won.

“While we’ll fight in court for as long as we need, let’s be clear: XRP’s status as a non-security is the law of the land today – and that does not change even in the face of this misguided – and infuriating – appeal,” he concluded.

XRP Crash Amid SEC Appeal

Following the appeal notice, the price of XRP, the native coin of the Ripple ecosystem, crashed significantly reflecting investors’ skepticism about the future of the project. At the time of writing, XRP declined by 11.78% to trade at $0.5294.

This sudden “fall from grace” happened right after XRP reached an intraday trading high of $.602. XRP traders and investors had been hoping for an upward trajectory that would shoot the price of the coin to new highs assuming the SEC did not make the appeal decision. However, all that hope looks to have been crumbled along with the price of the asset.

It is unsure what the outcome of the lawsuit will be, but the crypto community is closely watching to see how the situation unfolds.