And yet another month has gone by without a verdict in the legal battle between Ripple Labs and the US Securities and Exchange Commission (SEC). Although several lawyers from the XRP community had estimated the chances of a verdict by the end of April to be very high, Judge Torres of the District Court in the Southern District of New York has still not issued a ruling.
But a few hours ago, a rumor now surfaced on Twitter that could imply that a decision in the legal battle between Ripple and the SEC is near. However, since this is an unconfirmed rumor from an anonymous source, it should be taken with a grain of salt.
The Twitter account Blockchain Daily stated that Ripple and the SEC are reportedly holding an undisclosed meeting on May 8. The speculation now circulating on Twitter is that it could be about a settlement.
🚨JUST IN: REPORTEDLY RIPPLE AND SEC TO HOLD UNDISCLOSED MEETING ON MAY 8TH – UNCONFIRMED SOURCE pic.twitter.com/LNrUVCloQ1
— Blockchain Daily (@blckchaindaily) May 1, 2023
However, XRP community attorney John E. Deaton would “bet” that the rumor is false. According to him, lawyers from the SEC and Ripple can meet anytime they want. “I don’t think they would pick a date a week from now and then leak it out,” writes Deaton, who further surmises that a settlement won’t happen that way.
First, Deaton believes a settlement would only come after a ruling by Judge Torres, and only if Ripple wins a big victory, allowing Gensler to save face and score a political victory through a settlement.
Second, according to Deaton, the SEC would not schedule a meeting because of the market manipulation allegation and risk a leak. He believes Ripple and the SEC would “just meet,” which is why he makes the assumption:
This unconfirmed source sounds like someone was wanting to orchestrate a pump.
Why Would Ripple Settle After Winning?
According to John Deaton, under certain circumstances it may make sense for Ripple to enter into a settlement after a potential victory against the SEC. This would be “not like two years ago,” but would depend on the decision and whether the SEC would appeal.
Ripple could also be concerned about the regulatory safety of its partners. “Does Bank of America, a Ripple partner, feel comfortable with the decision or wait to see if Judge Torres gets overturned if the SEC appeals her ruling. Remember, the SEC can file a notice of appeal and withdraw it later, ” the lawyer writes.
In addition, Deaton thinks Ripple CEO Brad Garlinghouse will be happy to sign a settlement check if the SEC classifies all future sales of XRP as non-securities and does not appeal. Why? Because that would mean an immediate return of liquidity to the US. But a settlement would also only be necessary if Judge Torres does not already provide for it in her ruling.
At press time, the XRP price had not yet reacted (significantly) to the rumor. The market does not seem to give it any credibility. XRP changed hands for $0.4657.
Featured image from CoinPedia, chart from TradingView.com