Ripple (XRP) Faces New Legal Challenges But It’s Not the SEC This Time: Details

TL;DR

• Ripple’s token was named in a lawsuit by the Oregon Attorney General against Coinbase.
• Legal experts, including Bill Morgan, criticized the move as unjustified and out of touch, citing past rulings.

Another Attack on XRP

Ripple has the habit of making the headlines, but sometimes, the news surrounding it is not what its proponents want to see. Most recently, the company’s cross-border token was included in a lawsuit that the Oregon Attorney General (AG) filed against the US-based crypto exchange Coinbase.

The chief legal officer of the state claims XRP, SOL, ADA, LINK, UNI, and many more were offered and sold as investment contracts on the platform. The lawsuit refers to them as “crypto securities.”

The attack from the Oregon AG raised some eyebrows across the community. Bill Morgan – the prominent legal commentator known for his in-depth analysis of Ripple’s legal battles – was among those criticizing the action.

He said the chief legal officer of the state of Oregon ignored the fact that Coinbase delisted XRP from its platform in December 2020 after the US Securities and Exchange Commission (SEC) sued Ripple. The exchange re-enabled trading with the asset in the summer of 2023 following a court ruling that the secondary sale of XRP didn’t constitute an offer of investment contracts. 

“No one could have the imagination to make up this dystopian nonsense,” he added.

It is important to note that Coinbase faced similar problems from the SEC in the past. Nearly two years ago, the agency filed a 101-page lawsuit against the exchange, accusing it of violating securities laws by making certain cryptocurrencies that supposedly passed the Howey Test available for trade on its platform.

Some of the large-cap altcoins labeled as securities in the case included SOL, ADA, and MATIC, while XRP was not mentioned. The SEC drastically changed its hostile approach toward the crypto industry in the past several months, ending its legal disputes with numerous digital asset entities. The case against Coinbase is among the dismissed ones, but perhaps the most popular one (against Ripple) is still awaiting its official resolution. 

Latest Updates on the Ripple v. SEC Front

Last month, Ripple’s CEO, Brad Garlinghouse, announced a major win, revealing that the SEC would withdraw its latest appeal, signaling the effective conclusion of the lawsuit. The company’s chief legal officer – Stuart Alderoty – later confirmed this development.

The Ripple community was quick to celebrate this as the end of the case that had been dragging on for over four years. However, the battle needs to undergo additional legal proceedings before becoming part of history. 

Earlier this month, Ripple and the SEC filed a joint motion to request a pause on their individual appeals. Shortly after, the US Court of Appeals for the Second Circuit acknowledged and granted the submission. 

Although this brings the case closer to a formal resolution, the securities regulator has yet to make an official statement. Meanwhile, attorney James Filan noted that the agency has been ordered to submit a status report on its legal proceedings within 60 days of that ruling.

It may seem like the lawsuit’s end is just a matter of time, but analysts have warned that its eventual resolution is unlikely to impact XRP as it has already been priced in.