Trump's victory has driven a surge in the cryptocurrency market, with investors betting that the Trump administration will implement policies favorable to the growth of the cryptocurrency industry. Furthermore, Gary Gensler, the current chairman of the SEC, announced this morning (22) that he will resign on January 20 next year, further fueling market optimism.
Ripple token surges
With the incoming change in SEC leadership, the long-standing Ripple case is seeing more favorable developments. According to Coingecko data, Ripple (XRP) surged over 25% today to $1.39, reaching a new high since April 2021, and has increased by as much as 151.6% over the past 14 days.
Ripple token price chart. Source: CoinGecko
Ripple, the issuer of Ripple tokens, has been embroiled in a lawsuit with the SEC since December 2020. The SEC alleges that Ripple has been raising funds through unregistered securities, namely Ripple tokens, since 2013, amounting to as much as $1.3 billion.
The latest legal development is that Judge Analisa Torres reaffirmed her ruling from July of last year in August, stating that Ripple's sale of Ripple tokens to retail investors through exchanges did not violate securities laws. Regarding the hefty fines sought by the SEC, after determining that Ripple violated securities laws by selling tokens to institutions, the judge decided to impose a $125 million fine on Ripple, which is far lower than the SEC's requested $2 billion.
At that time, the judge also issued an injunction against Ripple, requiring it not to violate securities laws again.
Recently, it was reported that the SEC is seeking to appeal the latest ruling by Analisa Torres regarding Ripple. However, as Gary Gensler is about to step down, the next SEC chairman is expected to be someone friendly to cryptocurrencies, which may influence the direction of the Ripple case.
Which cryptocurrency companies targeted by the SEC are expected to benefit?
Currently, Trump has not officially announced his preferred candidate for the new SEC chairman, but the Washington Post recently cited five informed sources indicating that Trump's advisors are considering appointing current regulatory officials, former federal officials, and executives from the financial industry to key leadership positions, many of whom have publicly expressed support for cryptocurrencies.
The market is expected to welcome a cryptocurrency-friendly SEC, meaning that companies in the cryptocurrency space, like Ripple, which have been suppressed and sued by the SEC in the past, may see their lawsuits soften, settle, or even be dismissed. Below are several major cryptocurrency companies expected to benefit.
Binance: The SEC sued Binance and its founder Changpeng Zhao (CZ) last year for operating an unregistered securities exchange and submitted a revised complaint in September this year, reiterating allegations against Binance for violating federal securities laws.
Coinbase: The SEC sued Coinbase last year for offering trading, brokerage, and clearing services for unregistered securities, facilitating illegal transactions involving billions of dollars in cryptocurrency 'securities' since 2019 and allowing customers to earn rewards in securities products.
Kraken: The SEC sued Kraken last year, alleging that Kraken was not registered as a broker, exchange, or clearing agency, and that some cryptocurrency transactions on its platform constituted investment contracts, falling under the category of securities.
Additionally, Gary Gensler has insisted that most digital assets, except for Bitcoin and Ethereum, including $SOL , $ADA , and MATIC, are considered securities. This stance has been criticized as overly assertive by the cryptocurrency community, forcing cryptocurrency companies to operate in a regulatory vacuum. It is not ruled out that this situation could change going forward.
