• The SEC filed a case against Terra, a cryptocurrency firm, claiming that its tokens were unregistered securities.
• Do Kwon, the CEO of Ripple Labs, has cited the recent win by XRP as grounds for dismissal of the SEC case against Terra.
• Do Kwon believes that this ruling will set a precedent to dismiss other cases in the future including Terra’s.
SEC Files Case Against Terra
The U.S. Securities and Exchange Commission (SEC) recently filed a case against crypto platform Terra, claiming that its tokens are unregistered securities.
Ripple Labs Cites XRP Win As Grounds To Dismiss Case
Do Kwon, CEO of Ripple Labs, has cited the recent court ruling which found that XRP is not an unregistered security as grounds for dismissal of the SEC case against Terra. According to Do Kwon, this ruling will set a precedent to dismiss other cases in the future including Terra’s.
XRP Court Ruling
The court ruling in question was made in response to a lawsuit filed by multiple investors who claimed that Ripple had violated federal securities laws by selling XRP without registering it with the SEC first. In April 2021, Judge Torres ruled in favor of Ripple and declared that XRP was not an unregistered security under US law.
Crypto Industry Rejoices Over Ruling
The crypto industry rejoiced over this ruling as it cleared up some long-standing legal uncertainty among cryptocurrency companies operating within US jurisdiction. The ruling also provided much needed clarity on how digital assets should be classified under existing regulations going forward.
Terra’s Response To The Ruling
In response to Do Kwon’s statement regarding dismissal of its own case based on the XRP ruling, Tera said it would “continue to work closely with regulators to ensure full compliance with all applicable laws and regulations.“ The company further added that it „remains committed to developing innovative products and services for our users.“