Speaking at a luncheon hosted by the Press Membership DC, SEC Chair Gary Gensler made a strong allusion to a potential appeal of the current Ripple case ruling.
Gensler said in response to the finding that sellers of Ripple’s XRP coin on exchanges are not required to make disclosures: “We’re still looking into it and assessing.”
This comment has sparked speculation that the SEC would use an interlocutory appeal, a seldom granted appeal that could speed up the process.
According to Gensler’s reply, the SEC should consider making such a motion since they believe the current rule creates a significant enough amount of ambiguity.
The SEC chairman addressed the Ripple issue for the first time after the summary judgement decision last week in his public statement. He expressed dissatisfaction with how the ruling will affect small-time traders.
This statement was made against the backdrop of Ripple’s XRP losing value after a fast 80% surge in the wake of the combined decision, which many XRP traders took as an uber-bullish increase for the contentious coin.
Gensler’s concerns were mirrored by former SEC official John Reed Stark, who told U.Right This Minute that the Ripple decision is on “shaky ground” and might be appealed. Stark was troubled by the decision’s subtle distinction between private sales of XRP to authorised investors and programmatic sales to exchanges.
He claims that this could lead to the emergence of a new class of “quasi-securities,” whose standing changes according on the level of expertise of the investor. This was characterized by Stark as “counter-intuitive, inconsistent with SEC case regulation, and unprecedented in this context.”
The possibility of an appeal makes the case’s ultimate outcome and the long-term legal landscape for cryptocurrencies uncertain.
