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Highlights
- Ex-SEC lawyer warns of potential challenges in the XRP lawsuit ahead.
- This comes as Ripple CEO announced a likely victory in the ongoing case.
- The lawyer said that the US SEC under new administration could again create regulatory pressure on Ripple.
The XRP lawsuit has been one of the hottest topics of discussion this week after Ripple CEO Brad Garlinghouse said that the US SEC is dropping the case. Notably, this comes amid the shifting stance of the US SEC towards the digital assets space under Donald Trump’s presidency. Besides, the news has also sparked a short-term rally in XRP price, but it appears that the optimism was short-lived.
Amid this, an ex-SEC lawyer said that Ripple’s win could be short-lived. In other words, the lawyer hints that the chance of regulatory pressure on the blockchain firm still persists despite the CEO’s recent affirmation.
XRP Lawsuit Win Gains Traction
Recently, XRP has recorded a notable surge after Ripple CEO Brad Garlinghouse announced on X that the US SEC is withdrawing its case against Ripple, marking a significant milestone for the crypto industry. The XRP lawsuit, which began in 2020, has been a focal point in the debate over cryptocurrency regulations. Garnlinghouse wrote:
“This is it. The moment we have been waiting for. The SEC will drop its appeal, a resounding victory for Ripple, for crypto, every way you look at it. The future is bright, let’s build.”
The news triggered a short-term surge in XRP’s price as investors celebrated the legal breakthrough. However, this optimism was soon dampened by expert warnings that Ripple may not be entirely out of the woods.
Ex-SEC Lawyer Raises Concerns Over Ripple’s Future
While the ruling brings some relief, former SEC lawyer James Farrell highlighted that the XRP lawsuit outcome might not be as definitive as some believe. He argued that other regulatory bodies and private entities could still challenge Ripple’s past and future transactions. Farrell noted:
“That’s largely true but only vis a vi the SEC. Private plaintiffs, state securities regulators, and other US federal agencies can all take different positions. And of course every court in the United States is free to arrive at a contrary decision.”
He also pointed out that while Ripple’s programmatic sales of XRP were deemed not to be securities, future sales could still face legal scrutiny. In a separate comment, Farrell said:
“If the admin changes in 4 years, could the SEC sue Ripple for all the sales made looking backwards 5 years? Yes (absent legislation being passed in the interim)”
What’s Next for XRP and Ripple?
Despite this partial legal victory in the XRP lawsuit, Ripple still operates in a highly uncertain environment, as the ex-SEC lawyer noted. According to him, the chance of further lawsuits or regulatory challenges remains, especially if a new US SEC administration reopens scrutiny on past sales.
For XRP holders, the ruling brings short-term relief, but the long-term regulatory battle could be far from over. Whether Congress steps in with new laws to clarify crypto regulations remains to be seen.
However, experts remain bullish on the future trajectory of XRP despite these woes. In a recent analysis, a top market expert predicts XRP price to hit $38, calling it a “conservative” target, citing historical and technical trends.
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