The Ripple vs SEC lawsuit has been going wild lately and has given way to many interesting revelations. The telephone meeting three days ago revealed that the SEC is trying to contact foreign regulators to seek assistance from foreign regulators against Ripple.
Ripples’ Motion had No Legal Authority says SEC
The US Securities and Exchange Commission recently filed a letter listing the two documents that were stamped as part of the application. The SEC has asked the court to deny Ripple’s duplicate motion requiring regulators to stop using foreign requirements and hand over all materials collected. The US SEC said Ripple’s motion had “no legal authority.”
The SEC’s letter to Judge Netburn stated:
“Requests or requiring the disclosure of communications with foreign regulators could have broad adverse implications for the SEC across a wide array of governmental actions where the agency pursues cross-border cooperation to protect the United States’ capital markets and its investors.”
The SEC also stressed that the defendants continue to have the right to use any documents received and that they have ample opportunity to challenge their admissibility in court. The agency added that there was no reason to prevent a full fact sheet from being drawn up.
The SEC has contacted foreign regulators about voluntary requirements. In fact, the regulator continues to warn that their litigation assistance request is not ending and federal regulations are not forcing them to hand over privileged material. The SEC letter added:
“Since the start of discovery, the SEC has issued 11 Requests to 9 foreign regulators, covering approximately 20 entities and their affiliates. The Requests seek assistance in obtaining documents from 14 digital asset trading platforms, five companies that Ripple claims “use” XRP in its so-called “On-Demand Liquidity” and one investor that purchased XRP directly from Ripple, and its affiliates.”
Although two foreign regulators have refused to provide assistance, three foreign regulators have banned the SEC from disclosing their notices under the laws of their jurisdiction. More importantly, some people say that such disclosure is unlikely to be prohibited. It should be noted, however, that the SEC subsequently withdrew an application and is waiting for specific responses from other regulators.
Will the Lawsuit Impact XRP?
Brad Garlinghouse, CEO of Ripple Labs, has stated time and time again that most of their customers (nearly 95%) are based overseas. He also claimed that Ripple’s services are not that popular in the US due to regulatory uncertainties.
After this development is published, it will be tempting to see if it has a direct impact on XRP and Ripple and how the cryptocurrency market reacts to it. Despite a weekly decline of 33% at the time of writing, XRP was still seeing a 24-hour price increase of 9.6%.