John Deaton, an attorney representing 65,000 XRP token holders, has commented on the likely scenario and timing of the Ripple vs. SEC case. Between the lines, he suggested that both sides may come out of it with their heads held high.
Ripple presses on
Sharing his observations, John Deaton pointed out that Ripple is hitting the SEC from both sides and at the same time trying to end the case as soon as possible. This manifests itself in the fact that Ripple is pushing for summary judgment. This does not include emails and documents related to Hinman’s high-profile speech regarding Bitcoin and Ethereum. Also, not recognizing them as securities.
As he points out, these documents are relevant from a fair notice perspective. At the same time, Ripple is entitled to win the case because of the precise analysis associated with the Howey test:
“The emails and documents are most relevant from a fair notice perspective. Ripple can win based on a strict Howey analysis, and if that happens, the court will never have to decide whether Ripple received fair notice. Currently, I see that there will be no settlement, and the parties will allow the judge to make a decision based on the Howey analysis.”
According to Deaton, the verdict appears to be a foregone conclusion, and all the SEC is trying to accomplish is to minimize its losses. This could be influenced by extending the duration of the case and at the same time losing the trial precisely because of Howey.
As he points out:
“I can assure you that the SEC would rather lose a case based on a strict Howey analysis than on fair notice. If the court rules that Ripple was not given proper notice, most of the alternative currencies that have been traded over the last 7 years stand to win. If the court rules that XRP is not a security, only XRP will be affected.”
How long will the XRP – SEC case last according to Deaton?
Deaton also decided to outline the time period in which the case should be decided. In his opinion, according to the most optimistic scenario, it will be August of this year. The most pessimistic scenario, on the other hand, is December, where the judge will probably feel the pressure of time resulting from two years of proceedings.
Impact of the case on XRP and the crypto market
Recall that Ripple was accused by the SEC in December 2020, of fraudulently trading unregistered securities issued in the form of XRP coins. As a result of this news, many leading exchanges within the United States, fearing the legal consequences, decided to withdraw the possibility of trading XRP. The verdict is likely to affect a large part of the crypto market, as hypothetically many of the coins present on it were constructed and distributed on similar principles as the Ripple product.
