Ripple (XRP) price rises as SEC legal showdown drags on

Ripple (XRP) rose to $0.439217 on Friday from $0.377384 on Thursday in the face of an ongoing SEC lawsuit following comments from former SEC corporate finance director William Hinman.

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 Ether are not securities, Hinman said. (Bitrates.com)

William Hinman: Ether is not a security

A judge has granted the SEC’s request for a response in the case against Ripple Lab. The case was sparked by a speech by Hinman in which he said Ethereum was not a security.

Emails recovered as evidence reinforce claims that Hinman had some conflict of interest with the comments.

In 2018, Hinman’s speech included this statement:

“Based on my understanding of the current state of Ethereum, the Ethereum network and its decentralized structure, the current quotes and sales of Ethereum are not securities transactions.”

Hinman’s presentation stated that ethereum is not a security, and it was marked as an opinion based on his own understanding of ethereum and the ethereum network.

What’s more, according to his personal knowledge and understanding, the decentralized nature, and the transaction and sale of ether, is not safe.

On the other hand, Hinman demonstrated that there are four criteria to exclude the SEC’s argument, noting that the communications made in 2018 did not fall under attorney-client privilege.

XRP total market cap at $20.60 billion on the weekend chart | Source: TradingView.com

Additionally, communications by Hinman are not confidential information. Furthermore, if the SEC discovers any other information that can be protected, the only person who can claim to be Hinman.

Ripple violated the Securities Act of 1933?

Ripple’s defense in the case is that XRP’s purpose cannot classify the token as a security. Given that XRP functions as a medium of exchange, the SEC has no power or authority over Ripple.

Furthermore, Ripple stated that the currency is used as an intermediary for remittances, not a security.

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Ripple also argued that the SEC’s failure to clarify the classification of digital assets failed to provide Ripple Labs with timely guidance or warnings about how current laws apply to XRP.

However, the SEC questioned that Ripple actually took advice from them in 2012 to identify its product as an investment requiring SEC oversight.

However, Hinman’s remarks further strengthened Ripple’s defense by suggesting that if ether or XRP were purchased to participate in a decentralized platform rather than to profit from trading activity, then it was definitely not a security.

Featured image from CryptoGlobe, chart from TradingView.com

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