SEC’s Appeal Cannot Alter XRP’s Non-Security Status, Says Ripple CLO

Ripple Chief Legal Officer (CLO) Stuart Alderoty recently stated that the court decision regarding XRP's non-security status remains sacrosanct.

According to him, the US Securities and Exchange Commission (SEC) cannot alter XRP's non-security status even if it appeals.

He also noted that the securities regulator cannot change Judge Analisa Torres' ruling statement regarding XRP's secondary market sales.

Alderoty Says The SEC Can't Change XRP's Non-Security Status

In December 2020, the agency sued Ripple and its executives, claiming that unregistered XRP sales violated securities laws. The SEC also claimed that XRP is a security.

On August 8, 2024, Judge Torres closed the case by imposing a $125 million civil penalty on Ripple. She maintained that Ripple's programmatic sales of XRP are not investment contracts.

During an interview on Crypto Law TV with prominent law professor J.W. Verret, Ripple CLO Stuart Alderoty reconfirmed XRP's non-security status amid the SEC's opposition.

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Also, Alderoty discussed possible outcomes if the SEC appealed the court's Ripple-SEC lawsuit decisions. Alderorty assertions focused on Judge Torres' ruling regarding XRP's non-security status and its secondary market sales.

He recounted that the court labeled XRP a non-security, and its second-market sales don't amount to investment contracts.

Ripple CLO categorized this court's decision as the land of the land." Further, Alderoty mentioned that the Second Circuit can't alter the decision if the SEC appeals.

The executive's unwavering statements stem from the fact that the Second Circuit rarely overturns decisions from lower courts within the circuit.Moreover, the higher court has less than a 10% record of reversal of lower court rulings.

Ripple CLO Advise the SEC Against Appeal

During the interview, the host, Verret, questioned Alderoty about possible events should the SEC appeal.

The Ripple executive responded that the securities regulator has a slim chance of winning via an appeal, especially on XRP's non-security status even in the Supreme Court.

Alderoty stated: Given Judge Torres' careful treatment of all the issues in this case, we are very confident that the SEC won't be successful in overturning the court's decision."

So, he believes the SEC will continue to face rejection in appeal courts and even the Supreme Court.

However, the executive said the SEC's appeal moves will not surprise him, noting that the agency has undertaken irrational steps in its regulatory approaches.

Further, the Ripple CLO urged the SEC not to appeal the court's decision in the SEC VS. Ripple lawsuit. This is because the agency's litigation moves have been abortive so far.

Also, the executive stressed that the SEC lacks any considerable indications to prove that its core mission lies in investors' protection if it advances the case.

Alderoty pointed out that the case does not incline fraud allegations, investment harm, or victims. So, an appeal will not project the agency's core mission.

Further, Alderoty maintained that Judge Torres rejected the agency's tactics to extend its securities law through the case.

The executive stated: The court in our case criticized the SEC for engaging in litigation gamesmanship and tactics rather than faithfully applying the law."

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