Investors believe Ripple Labs, the company behind XRP, is on the verge of a major legal win in the case that has dogged the company for two years now.
The Securities and Exchange Commission (SEC) sued Ripple in 2020, claiming the company had not properly registered XRP as a security and also did not provide adequate disclosure to investors.
The lawsuit has been a big deal in the crypto community because the SEC believes a lot of cryptocurrencies are unregistered securities and should be regulated by the SEC. Crypto proponents have argued that cryptocurrencies are more akin to commodities and therefore should be regulated by the Commodities Futures Trading Commission (CFTC). How the case plays out could have a big impact on this debate.
The case now looks to be headed for a more immediate end, as both Ripple and the SEC recently filed separate motions calling for the U.S. District Court Southern District of New York to make a summary judgment.
Investors and executives at Ripple think Ripple is headed for victory, and its stock price is soaring this week, despite struggles in the broader crypto market. Ripple CEO Brad Garlinghouse also appears confident.
"As the summary judgment filings were made public, people realized that maybe the SEC really is overreaching," Garlinghouse said on Fox Business. "We think [the judge] has the necessary information to make the ruling, and we think it's very clear that the SEC is grossly overreaching its authority."
It does seem that Ripple is headed toward victory. SEC Chairman Gary Gensler seems to have softened his stance on this matter, recently saying he thinks Bitcoin and Ethereum should be regulated by the CFTC, which came as a surprise.
With Ripple moving so forcefully against the broader crypto market, which is rare these days, a win for Ripple would be great news for XRP, and the rally may continue.