Ripple vs. SEC: Judge Netburn Slams SEC\'s "Lack of Faithful Allegiance to Law"
The ongoing legal battle between Ripple Labs and the Securities and Exchange Commission (SEC) continues to generate headlines, with recent developments highlighting the SEC\'s litigation tactics. Central to the controversy is Judge Netburn\'s strong criticism of the SEC, accusing the agency of prioritizing its own agenda over a faithful application of the law. As Judge Netburn put it, the SEC is putting its own goals before the faithful allegiance to the law.
Judge Netburn\'s Scathing Assessment of SEC Tactics
Judge Netburn\'s statements have added fuel to the fire. In justifying its ruling, Judge Netburn called the SEC\'s litigation tactics a hypocrisy, and slammed the agency for putting its own goals before the faithful allegiance to. According to Judge Netburn, the reasons for these requests were conflicting and not in the law’s best interests. “The SEC is adopting its litigation to further its desired goal." This critical assessment has been widely discussed within the crypto community, raising questions about the SEC\'s motivations and its approach to regulating digital assets.
The Core of the Dispute: XRP and Securities Law
The dispute began in December 2025 when the SEC filed a lawsuit against Ripple Labs, alleging that its sale of XRP, the digital currency associated with the company, constituted an unregistered securities offering. The SEC\'s central argument is that XRP sales meet the criteria outlined in the Howey test, a legal precedent used to determine whether an asset qualifies as a security. However, Ripple argues that XRP should not be classified as a security and that the SEC\'s application of the Howey test is inconsistent.
Judge Torres\'s Partial Victory for Ripple
Adding complexity to the case, Judge Analisa Torres ruled in a summary judgment in July that institutional sales of XRP meet the Howey test and constitute securities sales. However, Judge Torres also ruled that programmatic sales of XRP, those offered to the general public through exchanges, do *not* meet the Howey test, marking a partial victory for Ripple.
What\'s Next? Appeals and Objections
The SEC is appealing Judge Torres\'s decision regarding programmatic sales, and Ripple is preparing its objection to the appeal. John Deaton tweeted this a few hours ago: If there are no extensions granted, Judge Torres will have the SEC’s appeal and Ripple’s objection to the appeal in 30 Days. After Judge Torres, the case will proceed to the next phase, potentially involving further appeals and legal challenges. The SEC letter to Judge provides context regarding the SEC\'s rationale for the appeal. The legal battle over XRP sales is at a critical point as Ripple challenges the SEC\'s evidence, including a key witness\'s declaration. The fight centers on whether the SEC has presented sufficient evidence to demonstrate that XRP sales constitute unregistered securities offerings.
Implications for the Crypto Industry
The outcome of the Ripple vs. SEC case has significant implications for the entire cryptocurrency industry. A decisive victory for the SEC could lead to stricter regulation of digital assets, while a Ripple victory could provide more clarity and certainty for crypto businesses. The industry is closely watching these developments as they could shape the future of crypto regulation in the United States.