TLDR
- Attorney John Deaton predicts that Ripple may launch an IPO by late 2025/early 2026, pending the confirmation of Paul Atkins as SEC Chairman
- The SEC must file an appeal brief by January 15, but Deaton believes the SEC will withdraw its appeal
- Judge Torres’ ruling was narrow, addressing only secondary market sales of XRP under the Howey Test
- If the SEC follows the Supreme Court’s case, they risk setting an unfavorable crypto precedent
- XRP price could hit new highs if SEC withdraws case, with some analysts predicting $19
The ongoing legal battle between Ripple and the Securities and Exchange Commission (SEC) are approaching a critical deadline, and the SEC is required to file its appellate brief by January 15. The case, which has drawn widespread attention in the cryptocurrency industry, may be headed for resolution according to a recent prediction by prominent cryptocurrency attorney John E. Deaton.
The SEC’s current position stems from Judge Torres’ ruling that sales of XRP in the secondary market did not qualify as securities under the Howey Test. This decision was a partial victory for Ripple but left some questions unanswered about the wider implications for cryptocurrency regulation.
Deaton, who has followed the case closely, suggests that the SEC’s appeal faces significant hurdles. The attorney points out that Judge Torres’ ruling was specifically limited to the Ripple case and does not create binding precedent for other cryptocurrency cases. This narrow range makes the appeal less attractive to the SEC from a strategic point of view.
“@Ripple he did not prioritize the presence of the community because that did not make sense under the previous CSS administration, maybe that will change in the future.”
— @bgarlinghouseI have already said that I believe we will see a Ripple IPO in the last quarter of 2025 or the 1st… https://t.co/mEHkIqpkCb
— John E Deaton (@JohnEDeaton1) January 6, 2025
Legal experts noted that even if the SEC were to succeed in its appeal, the case would likely go back to Judge Torres. She could then rule against the SEC using different aspects of the Howey Test, which could reach the same conclusion through alternative legal reasoning.
The timing of these developments coincides with potential changes in SEC leadership. The confirmation of Paul Atkins as SEC Chairman could reshape the agency’s approach to cryptocurrency regulation. Deaton believes the SEC may withdraw its appeal entirely as a result of this change in leadership.
Looking ahead, Deaton projects that Ripple could launch an Initial Public Offering (IPO) by late 2025 or early 2026. This timeline depends a lot on how quickly the appeals process ends and whether Paul Atkins gets confirmation as Chairman of the SEC.
The case has drawn attention from other judges in the area. Judge Rakoff has expressed criticism of the Torres ruling, highlighting the complex legal landscape of cryptocurrency regulation. These different judicial interpretations highlight the challenges of establishing clear legal frameworks for digital assets.
Financial analysts watching the situation noted that they could have impacts on XRPs market value. The cryptocurrency reached an all-time high of $3 in 2021. Some market observers suggest that a favorable resolution of the SEC case could drive the price higher, with some predictions reaching $19.
The SEC’s appeals strategy has risks beyond the immediate case. If the matter reaches the Supreme Court, the SEC could face a ruling that sets broader precedents for cryptocurrency regulation. Deaton suggests that this risk may prompt the SEC to seek a settlement rather than a full appeal.
A potential Ripple IPO would be a big step for both the company and the cryptocurrency industry. Public publicity would give Ripple additional capital and add to its institutional credibility. It would also show how regulatory clarity can enable growth in the cryptocurrency sector.
The resolution of this case could affect how other cryptocurrency companies operate in the United States. Judge Torres’ ruling specifically addressed sales of XRP on the secondary market, leaving other aspects of cryptocurrency trading and sales open to interpretation.
Market participants are closely watching the SEC’s next moves. The January 15 deadline for the appeal brief will provide insight into the agency’s strategy and determination to pursue the case.
The possibility that the SEC would withdraw its appeal prompted discussion of possible settlement terms. Deaton suggests that Ripple could agree to pay a fine to settle the matter, allowing both parties to avoid lengthy litigation.
Legal observers note that the SEC’s appeal faces procedural challenges. The specific nature of Judge Torres’ ruling makes it difficult for the SEC to argue for a broader application of securities laws to cryptocurrency trading.
The timeline of the case now depends on several factors, including the filing of the SEC’s appellate brief, potential settlement negotiations, and the confirmation process for new SEC leadership.
