Undisclosed SEC memo muddies waters in Ripple’s legal battle

Updated December 12, 2023 at 12:01 pm

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Undisclosed SEC memo muddies waters in Ripple’s legal battle

An undisclosed SEC memo, spotlighted in a recent Twitter discussion, questions the agency’s initial stance on XRP’s classification, complicating Ripple’s ongoing legal battle.

Bill Morgan highlighted a memo discussing the SEC’s internal views on XRP’s security status.

John Deaton, in his response, clarified that the memo didn’t label XRP as a non-security but indicated no enforcement recommendations, suggesting the SEC didn’t initially view XRP as a security.

To be clear, I didn’t say the memo concluded XRP is not a security. The memo was found to be privileged and not disclosed so I haven’t read exactly what it says. But Judge Netburn found it important to note that the authors of the memo, who were Enforcement lawyers at the SEC,…
— John E Deaton (@JohnEDeaton1) August 27, 2023

Impact on Ripple’s Lawsuit

Deaton pointed out that if the SEC was unsure about XRP’s status in 2018, it’s questionable to accuse Ripple leaders, Brad Garlinghouse and Chris Larsen, of previously selling XRP recklessly as an unregistered security. While the memo’s details are confidential, it challenges the SEC’s current stance against Ripple.

As the legal face-off between Ripple and the SEC unfolds, this undisclosed memo complicates the debate surrounding XRP’s classification and Ripple’s alleged misconduct.