In a recent legal development, Ripple has achieved a significant victory with the dismissal of most claims in a class action lawsuit involving XRP. However, the question of whether XRP should be considered a security continues to be a topic of debate. Although the recent ruling in California is a win for Ripple, there is still a possibility that XRP could be deemed a security under certain circumstances. This differs from a previous ruling in New York that stated XRP does not qualify as a security when sold to institutional investors.
Legal experts Fred Rispoli and Marc Fagel have shared their insights on the implications of these developments. Rispoli, a strong advocate for XRP, has emphasized the potential impact of California law on the definition of securities based on the court’s interpretation. On the other hand, Fagel, drawing on his experience with the SEC, has acknowledged the intricate federal and state considerations involved in determining whether XRP transactions fall under securities regulation.
Rispoli commented on the ruling, stating, “The court’s decision leaves open the possibility that XRP could be classified as a security under California law, if not federal law.” However, Fagel disagreed and highlighted that although California has adopted federal standards like the Howey test, its broader implications for federal courts seeking guidance remain limited.