Prominent legal expert, Bill Morgan, recently ignited a debate surrounding the implications of a judge’s recent decision concerning Ripple’s On-Demand Liquidity (ODL).
A Clash of Perspectives
Morgan highlighted his concerns via a tweet, where he flagged an inconsistency in the judge’s perspective. According to the legal stalwart, the judge’s view of institutional sales failed to align with the fact that ODL customers utilize XRP for payments and do not expect profit from merely holding it.
These comments were made in response to a tweet by Ripple’s CTO, David Schwartz. He had mentioned that Ripple was still grappling with the intricacies of the situation.
Schwartz emphasized that Ripple’s inability to conduct ODL-related sales in the U.S. was not overly detrimental to their operations. He stated that Ripple could continue ODL activities in the U.S., as long as XRP wasn’t directly sourced from Ripple.
The dialogues were sparked off by queries raised by a crypto researcher, Leonidas. He questioned whether ODL-related sales were now classified as securities in light of a recent summary judgment.
Ripple’s Recent Triumph and XRP’s Leap
The entire discourse takes place in the shadow of Ripple Labs’ recent legal victory against the SEC. On July 13, the court ruled in favor of Ripple, declaring that the offer and sale of XRP on digital asset exchanges did not qualify as offers and sales of investment contracts.
This milestone decision propelled XRP to the fourth largest cryptocurrency by market capitalization, as it experienced a sudden surge immediately after the ruling.
A Murky Legal Picture
Judge Analisa Torres, however, delivered a divided decision in the case. She concluded that XRP was both an unlawfully sold investment contract when sold to institutional buyers but perfectly lawful when sold via cryptocurrency exchanges or distributed to employees.
This judgment casts a shadow of uncertainty over the cryptocurrency markets if you really think about it. In this scenario, many believe that it is up to Congress to step in and provide clear guidelines to help navigate the crypto space.
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