Top XRP enthusiast highlights the significance of the SEC v. Ripple ruling to crypto, as Bitwise cites the verdict to get its Bitcoin spot ETF proposal approved.
It is over a week since the Securities and Exchange Commission (SEC) approved multiple Bitcoin spot ETFs for trading in the United States.
The asset managers that had their Bitcoin fund applications approved include Fidelity Investments, BlackRock, ARK 21Shares, Valkyrie, Grayscale, and Bitwise.
Even though the SEC has approved all Bitcoin spot ETFs, a prominent XRP community member, “WrathofKahneman (@WKahneman),” recently called attention to Bitwise’s Bitcoin ETF prospectus.
Bitwise Cites Ripple Ruling
In a bid to get its Bitcoin ETF approved, the top asset manager cited the SEC v. Ripple ruling in the prospectus. The XRP community member attached an excerpt of Bitwise’s prospectus to confirm the development.
Bitwise noted in its prospectus that “regulatory and enforcement scrutiny of digital assets has increased.” In this context, it cited the summary judgment in the SEC vs. Ripple case as one of the instances showing that scrutiny of digital assets has spiked.
While highlighting the Ripple decision, Bitwise stated that the U.S. District Court for the Southern District of New York ruled that Ripple’s XRP sales to sophisticated institutional clients constituted securities transactions.
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However, it found that offers and sales of XRP on digital exchanges, as well as distribution to employees and third-party developers, were not securities.
Significance of Ripple Ruling to Crypto
Reacting, WrathofKahneman emphasized that the Ripple’s summary judgment is significant for the entire crypto industry.
— WrathofKahneman (@WKahneman) January 19, 2024
Several legal experts have predicted that the Ripple decision could significantly impact decisions on other crypto-related matters. TerraForm Labs and Coinbase have already cited the Ripple ruling to argue that crypto assets themselves do not constitute securities.
While Terra lost this argument in court, the judge in the Coinbase legal tussle has yet to issue a decision on the matter. Unlike Terra and Coinbase, Bitwise did not cite the Ripple ruling in a lawsuit. It only referenced the ruling as part of an effort to get its Bitcoin spot ETF proposal approved.
Interestingly, the company was among the asset managers that recently received approval from the SEC to launch Bitcoin spot ETFs.