Ripple faces securities suit in Cali over ‘misleading’ statements from 2017

Ripple, the blockchain-based payment protocol, is facing a securities lawsuit in California over alleged misleading statements from 2017. The civil securities lawsuit against Ripple Labs, led by CEO Brad Garlinghouse, has been allowed to proceed by US federal judge Phyllis Hamilton. The case centers around Garlinghouse’s 2017 interview claim of being “very, very long” on XRP, despite selling millions of XRP that year. Judge Hamilton’s ruling diverges from a previous ruling in favor of Ripple by Judge Analisa Torres in an SEC lawsuit. Hamilton found that XRP could be considered a security when sold to retail investors, as they might have expected profits from Ripple’s efforts. This ruling challenges the belief that Torres’ decision would set a favorable precedent for the crypto industry in similar cases. The lawsuit highlights ongoing legal uncertainties surrounding crypto classification and executive statements.