Ripple, the company behind XRP, has won a major lawsuit in the US over the token's status. The court ruled that XRP is not a security and sales of XRP on exchanges do not constitute investment contracts.
The lawsuit was filed in December 2020 by the Securities and Exchange Commission (SEC) alleging that Ripple and its executives had raised over $1.3 billion through an unregistered and ongoing digital asset securities offering.
The SEC alleges that XRP is a security and that Ripple violated federal securities laws by selling it without registration or obtaining an exemption.
However, on July 13, 2023, Judge Analisa Torres of the US District Court for the Southern District of New York denied the SEC's claims and accepted Ripple's request for summary judgment.
Judge Torres stated that XRP is not a security because it does not meet the criteria of the Howey test, which is used to determine whether an asset is an investment contract.
Statement from Ripple
After the decision, which was welcomed by XRP fans, the first official statement came from Ripple as a company. In a statement on Twitter, the company wrote the following, almost as a victory speech:
“XRP is not a security.
For Ripple, this victory is a win for the entire industry and a step towards regulatory clarity in the US.
A huge thank you to Brad Garlinghouse, Chris Larsen, and Stuart Alderoty for their leadership and continued support of the XRP altcoin Community.”
*Not investment advice.