XRP Lawsuit Update: Ripple May Cease 'Historic Institutional Sales,' Says Lawyer

Highlights

Judge Torres denied Ripple and the SEC's joint motion for an indicative ruling.
Speculation is arising around Ripple's next move regarding XRP's institutional sales.
Bill Morgan believes that Ripple may halt its institutional sales of XRP.

As Judge Torres has denied the joint motion in the XRP lawsuit, questions arise about Ripple’s handling of the ‘historic institutional sales.’ Amid speculations, lawyer Bill Morgan hinted that Ripple might cease the institutional sales of XRP, previously classified as securities in the summary judgment.

Ripple Lawsuit: Permanent Injunction on XRP Sales?

In the latest development within the XRP lawsuit, Judge Analisa Torres has denied the joint motion submitted by Ripple and the SEC. With this move, the judge’s previous ruling imposing a permanent injunction and monetary penalty on the crypto firm remains intact.

While there remain two options for Ripple, as noted by CLO Stuart Alderoty, the company could either drop its appeal on “historic institutional sales” or move forward with the challenge. He stated,

With this, the ball is back in our court. The Court gave us two options: dismiss our appeal challenging the finding on historic institutional sales—or press forward with the appeal. Stay tuned. Either way, XRP’s legal status as not a security remains unchanged. In the meantime, it’s business as usual.

Meanwhile, lawyer Bill Morgan hinted at Ripple’s possible halt on the institutional sales via his latest X post. Asserting that the platform has already anticipated a permanent injunction on the sales, he added,

Ripple had obviously prepared for the likelihood of a permanent injunction on institutional XRP sales after the summary judgment decision in July 2023 and implemented a means of selling XRP to institutions. In the penalty phase it told the court it had restructured the way it undertook institutional sales to comply with Judge Torres’ reasoning and findings on institutional sales of XRP. This is in evidence.

Can Ripple Continue Institutional XRP Sales?

Following Judge Torres’ surprising denial of the joint motion in the XRP lawsuit, the community is speculating wildly about the token’s future sales. When a community member asked if Ripple could still offer institutional sales after registering with the SEC, lawyer Marc Fagel stated that it is possible if they comply with securities laws. He noted, “I believe they would be able to sell pursuant to a registered securities offering.”

This implies that the platform can no longer offer the XRP token for institutional sales unless the platform refiles the motion for an indicative ruling. As reported by CoinGape, lawyer Fred Rispoli believes that both Ripple and the SEC will likely drop their appeals and settle the case, upholding Judge Torres’ ruling. Adding more insights, Fagel added,

Whether a particular sale constitutes a sale of securities depends on the facts and circumstances. Ripple’s historical sales of XRP to institutional investors were ruled to be unregistered securities offerings.

Reinforcing Fagel’s comments, Bill Morgan also posited that the injunction creates uncertainty in the Ripple lawsuit, requiring the platform to ensure XRP sales to institutions comply with the Securities Act. Thus, these expert statements suggest that the firm may need to halt institutional sales if they do not comply with securities laws.

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Nynu V Jamal

Nynu V Jamal is a Senior Journalist at CoinGape. She boasts more than 3 years of experience in content writing, with expertise in crypto and blockchain. She has contributed to platforms like CoinEdition and CryptoTale, demonstrating her proficiency in navigating the dynamic crypto landscape. Beyond her journalistic pursuits, Nynu is a literary enthusiast, having served as an Assistant Professor of English Language and Literature. She is a Master's degree holder in English Literature and a UGC NET qualifier. Her academic background has enabled her to publish research papers on literature, while also nurturing her creative side as a published poet. Her creative side extends to music, crafts, and art, which she actively explores. Her unique blend of analytical and creative skills allows her to craft engaging stories that captivate audiences. Stay updated with Nynu on LinkedIn

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