XRP sees a 1.2% gain, closing at $0.6131, following a recent court ruling in the Kraken-SEC case.
Judge William Orrick rejected Kraken’s Motion to Dismiss the SEC’s claims.
Meanwhile, the court ruling aligned with the Ripple case’s reasoning that tokens aren’t securities.
On Saturday, August 24, XRP experienced a modest gain in the cryptocurrency market, rising 1.2% to close at $0.6131. This followed a 6% increase the day before, during which XRP briefly reached a high of $0.6304 before pulling back.
Notably, the gain comes as the crypto community digests a recent court ruling in the case of Kraken, a U.S.-based cryptocurrency exchange, against the U.S. Securities and Exchange Commission (SEC).
On Friday, Judge William Orrick rejected Kraken’s Motion to Dismiss the SEC’s claims that 11 cryptocurrencies, including XRP, are traded as investment contracts. While the ruling may seem like a setback for Kraken, the exchange’s Chief Legal Officer, Marco Santori, hailed it as a win.
Santori stated that the court’s decision aligns with the reasoning in the Ripple case, where a token itself isn’t considered a security, but the agreements surrounding it might be.
He further emphasized that the SEC’s argument that tokens are securities was rejected. Moving forward, the SEC will need to prove that each transaction on Kraken meets the Howey Test criteria. He expressed confidence that Kraken will prevail in proving these criteria are not met.
The SEC filed charges against Kraken in November 2023. It alleged that the exchange acted as a broker, dealer, exchange, and clearing agency for what it termed crypto asset securities without proper registration.
The SEC contends that certain crypto assets traded on Kraken qualify as securities because they were offered and sold as investment contracts, initially by their primary issuers and subsequently by Kraken.
However, Kraken disputes this characterization, arguing that the SEC cannot establish an ongoing relationship between crypto issuers and Kraken customers, negating the transactions as investment contracts under the Howey Test.
Pro-crypto lawyer James Murphy, aka MetaLawMan, offered his analysis of the ruling, noting that the Judge aligned himself with Judge Torres’s reasoning in the Ripple case on several points.
Murphy added that while the Judge felt the SEC met the Howey Test requirements at this early stage, he is not necessarily convinced that the SEC will ultimately be able to prove sufficient facts to show that these tokens actually traded as investment contracts on Kraken.
The ongoing legal battles could inject more uncertainty into the market, potentially affecting investor sentiment and demand for XRP. As the crypto community closely watches the developments in both the Kraken and Ripple cases, the outcomes could set significant precedents for the future regulatory landscape of digital assets.
The post Kraken Ruling Boosts XRP; Crypto Community Awaits SEC’s Next Move in Ripple Case appeared first on Coin Edition.
