However, XRP gains were short-lived as the SEC and Ripple progressed through the final stage of the SEC vs. Ripple case.
On March 26, the SEC filed a redacted version of the remedy-related opening brief. The SEC argued that Ripple continued to breach the 1933 Securities Act after the December 2020 complaint.
Ripple must file its remedy-related opposition brief by April 22 and a redacted version by April 24. The April 22 filing could dictate the size of the penalty for selling unregistered XRP to institutional investors. Significantly, Ripple must demonstrate it did not sell unregistered XRP to US institutional investors after the complaint.
Ripple may cite Morrison vs. NAB, where the Supreme Court ruled that the SEC only has jurisdiction over US-based sales. Failure to demonstrate that all XRP sales were to non-US institutional investors could expose Ripple to a $2 billion penalty. Significantly, an adverse ruling could impact Ripple’s US business goals.
Irrespective of the outcome, SEC plans to appeal the Programmatic Sales of XRP ruling remained an XRP headwind. In July 2023, Judge Analisa Torres ruled that programmatic sales of XRP do not satisfy the third prong of the Howey Test.
In October, Judge Torres Court rejected an SEC Motion for Interlocutory Appeal. The ruling means the SEC must wait until the end of the SEC vs. Ripple case to file appeals against court rulings.