The US Securities and Exchange Commission (SEC) yesterday filed a notice of appeal in the Ripple lawsuit, seeking to overturn an earlier decision made by Judge Analisa Torres.
Legal experts had predicted the regulator would appeal Judge Torres' 2023 ruling, which stated that Ripple's secondary sales of XRP were not considered sales of securities.
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According to the judge, XRP did not meet all of the requirements outlined in the SEC's Howey test, which is used to determine whether a financial asset should be classified as an investment contract.
Accordingly, Torres determined the secondary sales could not be classified as sales of unregistered securities.
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However, Torres noted the initial sales made by Ripple's founders to institutional investors did constitute sales of securities due to the method in which they were conducted.
This decision was applauded as a major success for Ripple Labs and the cryptocurrency industry as a whole.