Markets
Today’s XRP News: Market Outlook Brightens with Recent SEC Decisions Against Crypto Court
Possible results for SEC vs. Coinbase
Coinbase presented a Cross-appeal motion in April, asking the court for permission to appeal the motion to dismiss (MTD) decision.
For example, Coinbase filed a motion to dismiss in August, arguing that the SEC lacked statutory authority to regulate cryptocurrency exchanges. Judge Katherine Failla deniedfor the most part, the motion to dismiss, assuming,
“The court concludes that because the complaint’s substantiated allegations plausibly support the SEC’s assertion that Coinbase operated as an unregistered securities dealer, defendants’ motion should largely be denied.”
If Judge Failla grants Coinbase’s motion for interlocutory appeal, Coinbase could sue the SEC against Binance in its appeal. Successfully overturning the ruling on the motion to dismiss could end the era of regulation through enforcement and debate over whether cryptocurrencies are securities or commodities.
Significantly, court decisions denying that cryptocurrencies are securities give the Commodity Futures Trading Commission (CFTC) greater authority over the U.S. digital asset industry.
Will the cryptocurrency market benefit from CFTC oversight?
XRP and the broader cryptocurrency market could benefit from greater CFTC involvement for three reasons:
- Ending the debate over whether cryptocurrencies are securities or not could pave the way for XRP spot ETFs and a broader cryptocurrency spot ETF market.
- Support passage of the Lummis and Gillibrand Responsible Financial Innovation Act.
- Reduce the chances of the Digital Asset Anti-Money Laundering Act becoming law.
The Responsible Financial Innovation Act would give the CFTC more authority over the U.S. digital asset space. Additionally, the bipartisan bill would support innovation while protecting U.S. consumers.
In contrast, the Digital Asset Anti-Money Laundering Act proposes anti-money laundering (AML) and counter-terrorist financing (CFT) frameworks for the U.S. digital asset space. Senators Elizabeth Warren and Roger Marshall drafted the bill with the assistance of the American Bankers Association.
The bill seeks to impose bank-like regulation on the US digital asset sector, under the supervision of the SEC.
Ultimately, judicial decisions denying that cryptocurrencies are securities could empower the Commodity Futures Trading Commission (CFTC), promoting a more conducive environment for innovation. This change could pave the way for XRP spot ETFs and reduce legislative hurdles.