Former CFTC Chairman Chris Giancarlo has suggested that the SEC might drop its appeal against Ripple over XRP following a series of courtroom defeats. In an interview, he emphasized the need for regulatory agencies to reconsider cases they’ve lost at the trial court level. This comes amid optimism in the crypto community following Trump’s election victory, with hopes for a more crypto-friendly agenda. The SEC filed a lawsuit against Ripple Labs in December 2020, accusing the company of selling XRP as an unregistered security.
After years of legal battles, a landmark ruling in July 2023 concluded that XRP is not inherently a security, especially when sold on secondary markets. Ripple Labs was fined $125 million for the improper sale of XRP tokens. However, both parties have cross-appealed aspects of the decision, prolonging the case’s uncertain outcome. Ripple CEO Brad Garlinghouse has criticized the Biden administration’s stance toward cryptocurrency, calling it an “unlawful war” on the industry. He expressed optimism that a Trump administration would provide the clarity and support needed for crypto to thrive in the U.S.
Trump’s election victory has raised hopes for regulatory change, with reports suggesting that former SEC commissioner Paul Atkins, known for his pro-innovation stance, could replace Gensler. Atkins is respected for his understanding of cryptocurrencies and the SEC’s operations, making him a likely ally for the crypto industry. Trump’s team has indicated plans to decentralize crypto oversight, potentially shifting some responsibilities to the CFTC and appointing a dedicated “crypto czar.”
The potential retreat of the SEC from its appeal against Ripple could signal a broader shift in crypto regulation. As the incoming administration prioritizes innovation and clarity, the industry may see a significant turnaround in its U.S. prospects, paving the way for growth and investment. Giancarlo’s remarks highlight the need for regulatory agencies to reevaluate cases they have lost, potentially leading to a more favorable environment for crypto companies. The outcome of the Ripple lawsuit and changes in SEC leadership could have a significant impact on the future of crypto regulation in the U.S.
