Ripple v. SEC: What's at Stake for XRP? SEC Veteran Breaks It Down
2024-10-18

Yesterday, it was confirmed that the SEC officially filed an appeal in its case against Ripple. The appeal did not challenge the $125 million monetary penalty or the ruling on illegally obtained profits but instead focused on several key issues. These include the "programmed sales of XRP on the platform" and the distribution of tokens to Ripple employees.
One of the primary areas of focus for the SEC is the court’s decision that XRP sales on Ripple's platform do not qualify as unregistered securities. The regulator is also challenging the court's assertion that personal sales made by Ripple executives do not violate securities laws.
The timing of the SEC’s appeal raised controversy as the regulator initially missed the expected deadline. However, while the missed deadline caused concern, it appears the situation may not be as critical as initially believed.
What, where, when
This latest move by the SEC has drawn attention to opinions from various legal experts, including Marc Fagel, former director of the SEC’s San Francisco office and a seasoned security law expert. Fagel noted that the focus of the appeal is not on the monetary penalty or profits already ruled on by the court. 
Instead, the appeal revolves around the SEC's belief that the district court made legal errors regarding the classification of XRP sales and Ripple’s distribution practices.
No, that was never part of the case. (Which doesn't mean the Second Circuit can't weigh in on that issue as dicta, just as the district court did.)— Marc Fagel (@Marc_Fagel) October 17, 2024
Fagel further highlighted that if the SEC were to succeed in this appeal, it could result in additional penalties, though these would be directed toward investors or the U.S. Treasury, not the SEC itself.
The appeals process is expected to involve a three-judge panel, with a decision likely to take up to a year. For now, the focus remains on the SEC’s argument that the court’s ruling on XRP sales could set a problematic legal precedent for future cases.