- Ripple’s legal battles with the SEC persist, with a new lawsuit from Bitnomial linking them once again.
- Bitnomial’s lawsuit challenges the SEC’s intervention in listing XRP Futures, arguing that compliance is impossible due to XRP not being registered as a security.
- Following the SEC’s attempt to overrule Judge Torres’ ruling, XRP initially dropped 20% but has since stabilized with a modest increase.
Despite a historical win in 2023 – Ripple’s legal scuffles with the SEC could be far from over. Just recently, this already 4-year-long scuffle regarding XRP as a security got a new chapter. On Thursday, cryptocurrency derivatives exchange based in Chicago “Bitnomial” issued a lawsuit against the Securities and Exchange Commission in an episode that directly links Ripple with the SEC once again.
The lawsuit happened after Bitnomial was barred from applying to list XRP Futures with the Commodity Futures Trading Commission (CFTC). During the application, the SEC intervened claiming that this financial contract classified as “security futures” – which meant they fell under the commission’s rule. According to the SEC, as security futures, XRP Futures would need to follow both CFTC and the SEC guidelines.
This decision did not sit well with the exchange, who claimed in a 15-page lawsuit that the commission was overextending its jurisdiction. The filing details how the commission claimed that XRP Futures is a sort of “investment contract”, therefore making it a security.
Bitnomial also claims that even if that were to be the case, the company could not possibly comply with the request, listing that in order to list a security futures contract based on a single “security”, the issuer would have to register it under the Exchange Act. This would be impossible given that XRP is not registered – and given Bitnomial doesn’t issue XRP, the exchange could not possibly register the asset itself.
SEC Involved in Crypto Two Lawsuits on The Same Week
Interestingly enough, Bitnomial’s filing marks the second big lawsuit against the SEC this week. Just two days earlier, the well-known exchange “Crypto.com” also took legal action against the commission in a similar matter.
In that case, Crypto.com also questions if the SEC should have legal grounds to challenge CFTC’s authority and decide whether or not cryptocurrencies like XRP classify as security.
The timing of these lawsuits is also interesting – given that it comes just around 10 days after the commission filed a notice appeal and overrule the decision of Federal Judge Analisa Torres – when she ruled that XRP sales to retail investors in secondary markets were not securities.
How XRP Reacts to The News
When the market first took notice that the SEC was trying to overrule Judge Torres’ decision, $XRP suffered a hard hit as it lost around 20% of its value on October 1st.
However, despite the numeral news regarding even more lawsuits in which the main topic is the classification of the currency as a security, $XRP has not been affected by more bearish selloffs. Currently, the currency trades at $0.537 and is riding a modest 0.61% increase over the past 24 hours.
