The case between Ripple and the United States SEC has taken an unexpected turn. According to reports on the legal-crypto streets, Ripple has won a significant victory against the SEC. In its lawsuit against Ripple, the Securities and Exchange Commission suffered the worst crypto-defeat just yet. This is certainly an interesting development, following on the heels of a U.S. court’s refusal to recognize attorney-client privilege regarding internal papers pertaining to the “Hinman speech.”
The court has rejected the SEC’s claim that attorney-client privilege protects the production of records pertaining to William Hinman’s speech. According to Magistrate Judge Sarah Netburn, the SEC must produce these documents. The Judge called out SEC’s hypocrisy when the court ruled that collecting information from third parties does not fall within the scope of the privileged activity exemption.
The hypocrisy in arguing to the Court, on the one hand, that the Speech is not relevant to the market’s understanding of how or whether the SEC will regulate cryptocurrency. On the other hand, Hinman sought and obtained legal advice from SEC counsel in drafting his Speech, suggests that the SEC is adopting its litigation positions to further its desired goal, and not out of a faithful allegiance to the law.
Many in the XRP community have seen the Hinman speech draft, which the SEC has fought to keep secret, as a crucial piece of evidence that might work in Ripple Labs’ favor. Ripple argues that Bill Hinman, the former director of the Division of Corporation Finance, said in 2018 that Ether (ETH) was not “securities transactions” and this contradicts the SEC’s position on the issue. However, some people believe an appeal by the SEC is likely. The SEC insists that Hinman’s trip was a “purely personal errand” and not intended to provide legal counsel.
The crypto industry has recently experienced its worst bloodbath. The decentralized environment has been damaged by recession concerns, macroeconomic factors, and crypto legislation. According to some analysts, these financial regulators appear to have a vendetta against crypto to some extent. On the other hand, these organizations argue that they are safeguarding their citizens’ investments from the Wild West of finance.
If the content of the speech documents is strong enough, it might be a game-changing moment for Ripple. The case has been regarded as potentially laying a legal foundation for other similar crypto token issuers. The crypto seas are still murky. Bitcoin spent the day in a holding pattern as investors awaited U.S. inflation figures, which may add to volatility. The largest cryptocurrency was trading at $19,000`s.