Ripple vs SEC: Will be a decisive day tomorrow?

Tomorrow, Tuesday, August 31, 2021, could be a decisive day in the case of Ripple vs SEC.

In fact, a court hearing with both parties is scheduled for tomorrow to discuss the so-called “privileges dispute,” which has been going on for months.

Ripple vs SEC: What’s the situation?

The problem concerns certain SEC-owned documents that were not passed on to the other party, despite an explicit request, due to the hypothetical existence of certain “privileges” (DPP, deliberative process privileges). In other words, the SEC will have to try to get the court to recognize these privileges tomorrow, or it will be forced to hand over the entire documentation to Ripple.

If the SEC loses, the case could be seriously affected because the SEC clearly wants to hide something from the other side.

The “privileges dispute” has been going on since early June, when Ripple filed a motion to force the SEC to provide its internal documents related to the investigation into whether XRP is a security and not a payment token.

These documents relate in particular to the results of the Howey test on ETH, which show that it is not a security and which the judge also considered relevant in the case against Ripple.

Judge Netburn has also asked the government agency to provide this documentation, but the SEC has so far categorically denied it. One important thing to keep in mind is that the court could even theoretically dismiss the case on this point if the SEC did not continue to cooperate, even if it is considered unlikely.

Ripple and SEC: possible settlement

One of the scenarios that is considered likely is a settlement between the two parties.

For example, the lawsuit between the New York Attorney General’s Office and Tether and Bitfinex has ended amicably, and it is unlikely that the outcome will be similar.

If the SEC could not persuade a judge to confirm its right not to provide such documentation, a settlement scenario is much more likely because it would allow the agency not to provide the documentation without losing out in this case.

It is worth noting that XRP came before ETH in 2012, so having documentation showing that ETH should not be considered a security when it was created in 2015 would help Ripple defend itself against accusations of selling securities. without the necessary authorizations.

However, it should be noted that ETH and XRP were initially two very different things, not least because Ripple was not decentralized at all.

This question would still be completely open, but it could still develop very quickly for an agreement between the parties if the judge ruled against the SEC tomorrow.

If no agreement is reached, two more hearings are scheduled for the coming weeks. According to some insiders, if the court rules in favor of the SEC tomorrow, the case could drag on to 2022.