Crypto lawyers Jesse Hynes believe that the Ripple-SEC lawsuit resolution might be closer than ever. Hynes recounts his take on the outcome of the lawsuit.
He made the starting prediction that early XRP sales would be found to have broken securities laws.
As we get closer to the resolution of the Ripple case, I’m going to throw down my original thoughts from years ago so people can tell me how unreasonably wrong I am when the case is decided. Let me know your thoughts:
— Jesse Hynes 🌱 (@jesse_hynes) May 22, 2023
Hynes continues by saying that this will establish a precedent that the SEC will use to go after many other crypto businesses on the grounds that if anything is sold for fundraising, an investment contract has been established.
The crypto lawyer thinks the court will still decide that Ripple is no longer violating securities laws in the way it is now conducting sales.
The biggest unanswered concern for him is whether the court will decide to address the question of whether XRP is a security in and of itself, as well as how to handle the early sales if they are deemed securities. However, he worries that the court may not rule on this.
He points out that the SEC has been pushing this issue hard with its recent assertions, so the court might feel pressure to rule this way.
Hynes believes the only logical outcome would be that XRP itself cannot be an investment contract if the court makes a ruling about the status of XRP going forward.
Additionally, he believes that the fair notice defense will only be relevant if it is determined, strangely, that the asset XRP is an investment contract.
Ripple’s claim that there was no fair notice of this is very strong. However, this truly only benefits Ripple, not users.
Hynes affirms that he simply does not see a court deciding that the asset XRP is a security.
Another takes on Ripple-SEC outcome
Matt Hamilton, former director of developer relations at Ripple, believes the outcome of the Ripple-SEC lawsuit might not be anticipated due to the complexity of US regulatory and legal systems.
Hamilton noted that even if Ripple is in the right, the SEC may still be able to win the litigation.
The former Ripple director spoke as regards the recently discovered evidence by John Deaton, the founder of CryptoLaw, that SEC internal communications may show it is reasonable to assume that XRP does not satisfy all of the requirements of the Howey Test and may not be regarded as a security.