Will US Crypto Exchanges Relist The Controversial XRP? Adv. Jeremy Hogan Weighs In

Jeremy Hogan, a renowned lawyer, and avid commentator on cryptocurrency-related cases, has shared his views on the possible relisting of Ripple’s XRP by US exchanges.

Breaking Down the SEC Lawsuit

Although the Securities and Exchange Commission’s (SEC) lawsuit intimates that XRP itself constitutes a security, akin to a share of stock, the specific demands presented to the court in this case stop short of applying this status to the Ripple-issued crypto. This distinction is vital since the relisting of XRP on exchanges rests largely on the resolution of this security status issue, said Hogan.

However, the legal expert raises concerns that the court might not directly address this matter as it is not unambiguously presented by the SEC. The inherent ambiguity leaves lingering uncertainty for the exchanges, even though the absence of a clear designation might suggest it is not considered a security.

Ripple’s Potential Countermeasures

Despite these complexities, Hogan sees several possibilities for progress. Firstly, Ripple could secure the SEC’s agreement to include in the final judgment a clause stating that it doesn’t cover secondary sales. Such an agreement has been achieved in the past, as was the case with KIK Interactive.

Additionally, the judge might address concerns around secondary sales, responding to points raised by several Amici, including those advocated by attorney John Deaton on behalf of XRP holders. Hogan cites a precedent in the LBRY case where the judge agreed to address the matter of secondary sales.

A Clear Ruling on Secondary Sales

Another pivotal juncture could emerge if Ripple is unsuccessful in its defense. At this ‘penalties’ stage, the court would have to draft a disgorgement order, which necessitates a clear delineation of who should receive the disgorged profits. Ripple could then argue that only direct purchasers from Ripple, not secondary purchasers, are entitled to have their ‘investment’ returned. Hogan notes that this principle aligns with the SEC v. Wang case.

If the court concurs, it would effectively create a ruling on secondary sales. This ruling is critical as it would determine the allocation of the disgorged funds and potentially have significant implications for the future of XRP and its listing on exchanges.