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Ripple celebrates SEC’s dropped appeal, but crypto rules still not set

Ripple is celebrating the United States Securities and Exchange Commission’s (SEC) decision not to pursue a court case against the firm, but it provides little legal certainty for the crypto industry. 

The US financial regulator has apparently dropped an appeal against Ripple, the issuing firm of crypto asset XRP. The industry saw the case as a prime example of regulatory overreach by the SEC under former chair Gary Gensler.

Ripple CEO Brad Garlinghouse said the decision “provides a lot of certainty for RIpple” and that while the case is effectively over, there are still some loose ends the firm needs to tie up with the SEC. “We now are in the driver’s seat to determine how we want to proceed.”

Stuart Alderoty, Ripple’s chief legal officer, wrote on X, “Today, Ripple moves forward — stronger than ever. This landmark case set a precedent for the domestic crypto industry.”

Ripple and the crypto industry as a whole are counting this as a major victory, but the SEC’s decision provides no legal precedent, and the “guardrails” the industry has lobbied for are yet to be defined. 

Ripple celebrates SEC’s dropped appeal, but crypto rules still not set

Consequences of Ripple case on lawmaking and precedent

The cryptocurrency lobby was quick to celebrate the SEC decision, announced by Garlinghouse at the Digital Asset Summit in New York on March 19. Markets took notice — XRP price spiked 9% in the first hour following the announcement.

Supporters and observers posted on X about the precedent the case would set for the crypto industry. But legal observers are less certain about the overall impact the SEC’s appeal decision will have on the broader crypto industry.

Lawyer Aaron Brogan told Cointelegraph that the Ripple case “creates no precedent that any other firm can rely on.” He added there is “no question that the regulatory environment is more favorable to crypto firms today,” but the SEC’s exact policy won’t become clear until Paul Atkins is nominated as chair of the commission.

Related: Crypto regulation must go through Congress for lasting change — Wiley Nickel

Brian Grace, general counsel at the Metaplex Decentralized Autonomous Organization, further noted that the 2023 decision to which the SEC was appealing does not set a legal precedent.

He wrote on March 19, “The Ripple decision is not binding legal precedent. It was a single district court judge’s ruling based on the facts of that case.” 

Ripple celebrates SEC’s dropped appeal, but crypto rules still not set

The SEC appeal repeal also has limited influence on the ongoing legislative efforts to create a framework for the cryptocurrency industry in the US. Grace said that the onus is on Congress, not the SEC, to make lasting legal changes for the cryptocurrency industry. 

“The U.S. crypto industry needs new legislation to provide clarity and protection. Without it, the Plaintiffs bar can continue to sue in district courts across the country relying on Howey. A friendly SEC also does not change this. We need a crypto market structure law,” he said

Brogan said that he didn’t think the decision would have any direct effect on the lawmaking process, but the SEC could still solve questions regarding rulemaking.

“I think many in Congress would welcome that as the market structure legislation currently percolating appears dead in the water,” he said.

Garlinghouse wants to tie up loose ends with SEC

The SEC appeal decision may put the “final exclamation point” on whether XRP is a security, but the legal battle between Ripple and the SEC could be set to rage on.

In a March 19 Bloomberg interview, Garlinghouse brought up the possibility of going on the offensive with a cross-appeal, i.e. an appeal from an appellee requesting that a higher court review a lower court’s decision. 

Related: Bitnomial drops SEC lawsuit ahead of XRP futures launch in the US

Namely, Garlinghouse wants to revisit the 2023 decision in which Judge Analisa Torres, while ruling Ripple’s publicly sold tokens did not constitute a security, levied a $125 million fine on Ripple, stating that the tokens should have been sold to institutional investors. 

The firm is also subject to a five-year “bad actor” prohibition on fundraising which, says Brogan, could meaningfully impact its operations. 

“At this point, all we’re fighting for is do we want to fight to get the $125 million back,” said Garlinghouse.

He added that while the XRP-securities decision was a “clear legal victory,” there are “pieces of it that we think could be kind of cleaned up. And the question is, do we want to fight that fight? Or can we come to an agreement with the SEC to drop everything?”

Outside of the courtroom, Congress is still working to make meaningful progress on the stablecoin bill. Bo Hines, the executive director of the President’s Council of Advisers on Digital Assets, expects the final version to be ready in a couple of months. 

The crypto framework bill FIT 21 failed to make it through the Senate in the 2024 legislative session, but some lawmakers are optimistic that it will make it through this session with “modest changes.”

The Blockchain Association, a crypto lobby group, expects both laws to pass by August, while US Representative Ro Khanna, a Democrat from California, says they could be finalized by year’s end. 

Magazine: Memecoins are ded — But Solana ‘100x better’ despite revenue plunge

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Courts system in a ‘calamitous’ state, warns ex-judge who recommended jury cuts

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Courts system in a 'calamitous' state, warns ex-judge who recommended jury cuts

Sir Brian Leveson, who conducted the independent review of the courts system that guided the government’s decision to reduce on jury trials, has suggested there is no alternative.

Speaking to Sky’s Politics Hub programme, the retired judge argued that by restricting jury trials, Justice Secretary David Lammy is “aiming to try to solve the systemic problems” in courts.

He told Sky presenter Ali Fortescue: “I am a great believer in trial by jury, but trials with a jury take very much longer than trials conducted otherwise than with 12 people who are utterly unused to criminal procedure and criminal evidence.

“So my concern is that we need to get through cases quicker.”

He said that it was likely a “20% time saving would result” from the move, although he thinks that “a great deal more” would be saved.

Asked about the criticism today of the decision, Sir Brian said: “I’m gaining no pleasure from it, but what I say to all of them is ‘If not this, then what?’ How do we reduce the backlog so the victims and witnesses get their day in court within a reasonable time?”

He argued that “we should use our resources proportionately to the gravity of the offending”, and “there are some cases which, to my mind, do not merit or require a trial by jury”.

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Sir Brian said that some jurors he had spoken to said it was “worthwhile”. But he added: “They’ve given up two weeks of their life, sometimes without any pay except the small remuneration that they receive from the state doing jury service, and they’ve been trying cases which shouldn’t merit their attention”.

Asked if he would want a trial by jury if he had been wrongly accused of theft, Sir Brian said: “If I’d been wrongly accused of theft, I’d be perfectly happy for a judge to decide I’d been wrongly accused of theft.”

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Jury trials to be scrapped

More broadly, he said: “I don’t see how you’re going to bring down the backlog without more money, more sitting days, greater efficiency, and speedier trials…

“There aren’t the judges, there aren’t the court staff, more significantly there aren’t the advocates.”

He said that the justice system had never been in such a “calamitous” state.

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‘The reforms are about fairness’

Courts minister Sarah Sackman also defended the decision on Tuesday’s Politics Hub. She acknowledged that jury trials were “a success story”, and “a cornerstone of British justice and will remain so after today’s plans”.

But she added: “What’s not such a success story is the fact that we inherited record and rising backlogs in our courts.

“Today the number starts at 80,000 cases, and it’s on the rise – due to hit 100,000 by 2028.”

That leaves victims “waiting for their case to be heard”. She argued that the measures announced on Tuesday were “a set of reforms that will restore confidence in our justice system, get those delays down, and indeed preserve jury trials for the most serious cases”.

Ms Sackman added that “right now in our system, 90% of cases [are] being heard without a jury in our magistrates”, which is “fair, robust justice”.

“Part of fairness is about the swiftness we need to deliver swifter justice for victims,” she said.

“What’s not fair is a victim of crime being told today that she needs to wait until 2029, 2030 for her day in court.”

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‘Swifter justice for victims’

The minister gave an example of what will change, saying: “Supposing a defendant is accused of stealing a bottle of whisky.

“Is it right that we allow the defendant to insist on a slower, more expensive jury trial in the same queue as the victim of rape, making her wait and in some cases, justice not being served?

“That’s the choice that we’ve made today.”

But the minister refused to say how much this would reduce the backlog by.

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Inquiry into Crown Estate launched after controversy over Andrew’s Royal Lodge residence

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Inquiry into Crown Estate launched after controversy over Andrew's Royal Lodge residence

An influential parliamentary committee is launching an inquiry into the Crown Estate – the vast range of properties and land owned by the monarchy.

The move by the Public Accounts Committee follows scrutiny of Andrew Mountbatten-Windsor’s living arrangements at Royal Lodge on the Windsor Estate, and the revelation he pays a peppercorn rent.

The Crown Estate and the Treasury were asked to explain and justify his lease agreement to the committee after the series of scandals over Andrew’s controversial links to Jeffrey Epstein which saw him step down from royal duties and lose his royal style and titles.

The former prince has consistently denied allegations of sexual abuse and his accuser, Virginia Giuffre, took her own life this year.

Public Accounts Committee chair Sir Geoffrey Clifton-Brown thanked the Treasury and Crown Estate for responding to questions and said the committee’s “overall” mission was to “secure value for money for the taxpayer”.

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He said: “Having reflected on what we have received, the information provided clearly forms the beginnings of a basis for an inquiry.”

More on Andrew Mountbatten Windsor

The inquiry into the Crown Estate will start in the new year and will consider leases given to members of the royal family, as well as wider work based on the estate’s annual accounts.

Part of the responses given to the committee confirm Andrew won’t receive any compensation for leaving Royal Lodge due to the maintenance and repairs the property needs.

It has also been revealed that the Prince and Princess of Wales have a 20-year lease on their new home, Forest Lodge, also situated within Windsor Great Park.

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Government delays Chinese ‘super embassy’ decision

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Government delays Chinese 'super embassy' decision

The UK government has again delayed its decision over whether to approve a Chinese “super embassy” in London until January.

A decision over the controversial plan close to the Tower of London will now take place on 20 January, instead of 10 December, a letter from the planning inspectorate seen by Sky News says.

Despite multiple delays, Sky News understands the government is expected to approve the plans for what would be Europe’s largest embassy, with both MI5 and MI6 said to have given their blessing to the decision.

Politics latest: Jury trials to be scrapped for those facing sentences of three years or less

Housing Secretary Steve Reed has said he needs more time to consider new representations from the Foreign Office and Home Office.

A letter from the home and foreign secretaries to the planning inspectorate, published with the latest delay letter, said their national security concerns have been addressed by the Chinese government committing to ensure all its diplomatic premises in London, excluding the ambassador’s house, are consolidated on to the new embassy site.

The new letter sent to ministers and “interested parties”, including the Inter Parliamentary Alliance on China (IPAC) – which has warned against approving the embassy – said the government aims “to issue the decision as quickly as possible” on or before 20 January.

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Luke de Pulford, executive director of IPAC, told Sky News: “This is the third delay, and entirely of the government’s own making.

“Residents and dissidents have endured months of dithering as the government tries to choose between UK national security and upsetting Beijing.”

The basements in most of the buildings have been greyed out 'for security reasons'. Pic: David Chipperfield Architects
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The basements in most of the buildings have been greyed out ‘for security reasons’. Pic: David Chipperfield Architects

Three delays by Labour government

Mr Reed became housing secretary in September and had already delayed the decision once from October, as he said he had not had enough time to look at the details.

A decision had also been delayed earlier this year by the former housing secretary Angela Rayner, months after the Chinese re-submitted their planning application two weeks after Labour won the general election.

That was after Tower Hamlets Council rejected the application in 2022 and the Conservative government said it would not call it in for ministers to decide.

Read more:
Everything we know about China’s new ‘super embassy’

There have been multiple protests against the embassy's development. Pic: PA
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There have been multiple protests against the embassy’s development. Pic: PA

National security concerns

There have been large-scale protests against the embassy – on the site of the former Royal Mint – over concerns it will be used as a Chinese spy hub for Europe.

Hong Kong dissidents who have fled to the UK have expressed fears that rooms redacted “for security reasons” in submitted plans might be used to detain them.

The latest delay comes less than 24 hours after Sir Keir Starmer warned China poses “real national security threats to the United Kingdom” and said being tough on national security will enable the UK to pursue economic opportunities with Beijing.

He said UK government policy towards China cannot continue to blow “hot and cold” and said his government will focus on the relationship with Beijing.

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Starmer on China: ‘It’s time for a serious approach’

Chinese embassy says UK interfering in its affairs

A Chinese embassy spokesman in London said China “firmly opposes the erroneous remarks” and accused Sir Keir of making “groundless accusations against China” and interfering in China’s internal affairs.

“Facts have fully demonstrated that China has always been a builder of world peace, a contributor to global development, and a defender of the international order,” he said.

“On issues of peace and security, China has the best track record among major countries. China’s development poses no threat to any country, but instead brings opportunities for common development to all.”

He said the UK should “adjust its mindset, adopt a rational and friendly approach towards China’s development”.

Last month, MI5 warned MPs, peers and parliamentary staff about the risk from Chinese spies after identifying two LinkedIn profiles it said are being used by the Chinese Ministry of State Security to act as “civilian recruitment headhunters”.

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