December 2, 2023

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Ripple case more important than ever amid Coinbase, Binance SEC crackdown: lawyers

Ripple case more important than ever amid Coinbase, Binance SEC crackdown: lawyers

Cryptocurrency lawyers told Cointelegraph that the judges presiding over the Coinbase and Binance lawsuits will likely be watching the outcome of the SEC v Ripple case closely.

Ripple has been embroiled in a legal battle with the US Securities and Exchange Commission since December 2020, with the regulator alleging that Ripple has offered unregistered securities via XRP (XRP) since 2013.

On June 6, the Securities and Exchange Commission filed a lawsuit against Coinbase alleging it offers unregistered securities. A day before it filed a lawsuit against Binance containing some similar allegations.

Attorney James Murphy, known as “MetaLawMan” on Twitter, explained in a series of tweets on June 9 that a positive outcome for Ripple could “undermine the entire basis of the SEC case” against both Coinbase and Binance.

However, he also cautioned that “before anyone gets too excited,” Judge Torres’ ruling in the Ripple case will not set a “binding precedent” for these latest filings.

This means that the judges in the Coinbase and Binance lawsuit “will not be obliged to rule in the same way,” as only the decisions of the Court of Appeals and the Supreme Court have this effect.

Speaking to Cointelegraph, pro-XRP attorney John Deaton believes that the SEC is “well aware” that Judge Torres’ decision in the Ripple case will be published “in the very near future.”

Deaton believes that the SEC intentionally filed these new cases prior to that outcome, should the regulator face an unfavorable outcome in the Ripple case, saying:

“I think the SEC wanted to file those cases prior to this decision just in case it was a bad outcome for the SEC, which could cause them to lose some political and legal momentum.”

Murphy believes that the judge assigned to the Coinbase case, Judge Reardon, will “pay very close attention” to determining whether or not XRP constitutes a security, noting that they are serving in the same court in lower Manhattan.

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He believes Reardon will “follow the same logic” regarding whether the 13 tokens mentioned in the Coinbase complaint are securities, adding that this could go “both ways,” if it is a positive SEC finding.

XRP Compliant Attorney Bill Morgan, an advisor at Morgan Mac Lawyers, saw the Ripple case as having an impact on the Binance and Coinbase cases.

Morgan explained that the outcome of the Ripple lawsuit could be used as an “advantage” to the industry or the SEC, depending on the outcome.

“If they lose badly in the Ripple case, they are moving forward with Coinbase and Binance with a huge judgment against them. Obviously, Coinbase and Binance will use that to their advantage that XRP sales are not an investment contract.”

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Deaton noted that he actually predicted back in 2022 that the SEC would sue Coinbase and Binance “by the way the SEC was approaching the Ripple and XRP case.”

However, he believes that the SEC will soften its action against crypto companies once major financial institutions adopt a larger share of the cryptocurrency market.

“Once JPMorgan or Goldman Sachs or other traditional players get a larger slice of the cryptocurrency market, the SEC will make more sense,” he stated.

magazine: Pro-XRP Advocate John Deaton ’10x More in BTC, 4x More in ETH’: Hall of Flame