Matt Rosendin, the founder of digital securities platform CapSign, has predicted that San Francisco-based firm Ripple will end up appealing the recent court decision to issue an injunction.
As reported by U.Today, Ripple was ordered to shell out $125 million worth of penalties in her final judgment. This was framed as a significant win for the company given the aforementioned sum is substantially lower than the $2 billion that the SEC was asking for.
Still, Torres also issued an injunction against the San Francisco-based company that is supposed to prevent further violations of securities laws.
While the court’s language is vague, Rosendin believes that this injunction forces US institutions to purchase XRP tokens from the market rather than directly from the company. This would complicate the adoption of the On-Demand Liquidity (ODL) product in US markets, according to Rosendin.
At the same time, he believes that Ripple does not need to sell XRP directly to US institutions in order to have success.
Rosendin has also noted that Ripple can sell XRP tokens to institutions, but it needs a federal securities exemption. “Such sales are exempt from SEC registration provisions,” he added. “The only practical exemption Ripple can claim is Regulation A, but that limits XRP sales for ODL to $75m per year, which is not ideal at all,” he added.
The SEC might be satisfied with the financial penalties, but there is also some speculation that it might appeal the July 2023 ruling about secondary XRP sales not being securities. As noted by Fortune, a higher court ruling in this case would not be likely this year.
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