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US SEC to Appeal XRP Secondary Sales In Ripple Lawsuit, Says Ex-SEC

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3 months ago

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Former SEC official Marc Fagel has indicated that the U.S. Securities and Exchange Commission (SEC) may appeal the court ruling regarding secondary sales of XRP. This follows a landmark decision which found that primary sales of XRP were not securities. However, Fagel highlighted that the Ripple case did not address secondary market sales, which the SEC might now target.

Ex-SEC Marc Fagel Predicts SEC Appeal in Ripple XRP Case

According to Marc Fagel, the SEC is likely to appeal the decision on the secondary sales of XRP. He emphasized that the previous Ripple court ruling explicitly excluded these sales from its verdict, thus opening a window for the SEC to readdress this issue.

The former SEC official emphasized,

”I’m just saying they’re not foreclosed by the Ripple decision from bringing a case against another entity selling XRP as a security”

Fagel’s commentary sheds light on potential future actions by the SEC, which remains vigilant in interpreting what constitutes security under its jurisdiction.

In response, Lawyer Bill Morgan questioned the rationale behind treating the Bitnomial XRP futures as security futures contracts. He pointed out the inconsistency in regulatory enforcement, especially when comparing XRP to similar cases with Ethereum (ETH), where the SEC had previously shown no objections to the futures contracts.

Morgan expressed frustrations, stating,

“I cannot abide such arbitrary enforcement. No wonder the crypto market is so distorted towards Bitcoin and Ethereum.”

Legal Challenges and Industry Reactions

In addition, Ripple CEO Brad Garlinghouse has criticized the SEC’s persistent stance that XRP is a security despite court rulings suggesting otherwise. His criticisms underscore a broader industry frustration over what many see as arbitrary and overreaching regulatory actions. 

Garlinghouse’s comments came after the SEC was perceived as disregarding a judicial decision during its ongoing litigation with the crypto derivatives exchange Bitnomial. In support, Brad promised Ripple would follow up on the developments to hold the commission accountable.

Moreover, the Bitnomial case itself has become a significant point of contention. The exchange has argued that XRP futures should be regulated by the Commodity Futures Trading Commission (CFTC), not the SEC. Concurrently, the exchange advocates that XRP is not a security and should not be subjected to such stringent securities laws.

These developments come amid Ripple’s cross-appeal in the ongoing legal battle with the US Securities and Exchange Commission (SEC). This strategic legal move by Ripple aims to address unresolved issues beyond the initial ruling that XRP is not a security. Specifically, the cross-appeal will tackle the broader implications of the SEC’s claims about XRP sales on various exchanges and other distributions, which the SEC had attempted to appeal earlier.

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Ronny Mugendi

Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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Litecoin ETF Likely Next Spot Crypto ETF to Get SEC Nod; Bloomberg Analyst

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January 22, 2025

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A Litecoin ETF may be the next cryptocurrency ETF to be approved in the United States given the current circumstances. Bloomberg Senior ETF Analyst Eric Balchunas made this prediction after Canary Capital filed an amended S-1 registration form in relation to its Litecoin ETF proposal.

Amended Litecoin ETF S-1 Filing Suggests SEC Engagement

Canary Capital had submitted the S-1 registration form for the Litecoin ETF with the U.S. Securities and Exchange Commission (SEC) in October 2024. On Wednesday, the company filed an amended version of this form. According to the filing, U.S. Bancorp Fund Services would act as the administrator of the ETF, while Coinbase Custody Trust and BitGo would act as the custodians for the Litecoin of the fund.

Some of the industry watchers including the Bloomberg analysts have suggested that that the modification of the filing could be an indication of SEC’s interest. Another Bloomberg ETF analyst, James Seyffart pointed out that the amendment could mean the SEC has offered comments on the application. However, there has been no 19b-4 filing made, which is a formal application for rule change that initiates the approval process.

“We had heard chatter that the Litecoin S-1 had gotten comments back from [the] SEC,” said Balchunas in a post on X (formerly Twitter). He also said that this is in line with his earlier claim that Litecoin is ‘most likely’ to be the next cryptocurrency ETF in the United States.

New SEC Leadership Adds Uncertainty

The timing of the Litecoin ETF’s approval process could depend on upcoming changes in SEC leadership. Gary Gensler, the current SEC chair, is set to step down on Monday. Former SEC commissioner Paul Atkins, who has expressed support for the cryptocurrency sector in the past, has been nominated to lead the agency. 

However, the Senate has yet to confirm Atkins’ appointment, and the exact timeline remains uncertain.

Balchunas emphasized that the leadership transition is a “huge variable” in the approval process for the Litecoin ETF.

Growing Interest in Spot Crypto ETFs

Created in 2011 as a more efficient version of Bitcoin, Litecoin is one of the oldest and most stable blockchains. Following the announcement, the price of Litecoin spiked by more than 18% to trade at $119.46 at the time of writing. 

Analysts believe that the current bullish rally may break through the $130 barrier, with the LTC price prediction standing at $170. In addition, open interest increased by 29.58% to $575.39 million within the last 24 hours while the trading volume jumped significantly by 277.25% to $1.65 billion.

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This excitement comes in the wake of the recent approval of U.S. spot Bitcoin and Ethereum ETFs in recent months. These products outperformed the market, which led to the growth of interest among issuers in the creation of ETFs for altcoins like Solana and XRP.

A recent JPMorgan and Hashkey research note suggested that new Solana and XRP ETFs could pull in $13.6bn of new funds if they are approved within six to 12 months. The introduction of altcoin ETFs such as Litecoin may also contribute to increased institutional investments in the cryptocurrency space.

Next Steps for Litecoin ETF Approval

Even though the amended S-1 filing marks a progress, there is no certainty as to when the approval of the Litecoin ETF will be completed. The submission of a 19b-4 application would formally kick off the SEC’s decision process but Canary Capital has not given any indication of when this would happen.

The original filing of Canary identified Litecoin as a blockchain that has had “100% uptime since its inception” noting its security and stability as strengths. Industry participants are now focused on the next steps, such as the SEC’s response and the possible 19b-4 filing, as the momentum for the approval of the Litecoin ETF picks up.

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Kelvin Munene Murithi

Kelvin is a distinguished writer with expertise in crypto and finance, holding a Bachelor’s degree in Actuarial Science. Known for his incisive analysis and insightful content, he possesses a strong command of English and excels in conducting thorough research and delivering timely cryptocurrency market updates.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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South Korea Regulator Suspends Upbit Operations Over KYC Violations

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1 hour ago

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January 22, 2025

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In the latest development in the Upbit scrutiny, South Korea ordered the platform to suspend its business operations. Citing violations of Know-Your-Customer (KYC) rules and anti-money laundering laws, South Korea notified the exchange about the suspension. Upbit’s future services in the country remain in jeopardy as the exchange has received severe-than-expected sanctions.

Upbit To Suspend Business in South Korea

The South Korean Financial Intelligence Unit has warned Upbit crypto exchange over its alleged violations of the Specific Financial Transaction Information Act. Reportedly, this warning could affect Upbit’s future in South Korea, with a possible halt of services for up to six months. As per the notice, the crypto platform would be restricted from new customer-related activities while existing clients could continue their trade.

Notably, a disciplinary hearing is scheduled on January 21 over the exchange’s KYC violations. Upbit could submit its response by January 20. The FIU’s sanctions-level meeting is expected to evaluate Upbit’s regulatory compliance. During Upbit’s virtual asset service provider (VASP) license renewal program, South Korea discovered more than 500,000 cases related to KYC violations. As these cases include account approval without proper identification, they are considered as unauthorized customer verifications.

How Will Upbit’s KYC Violations Impact the Broader Crypto Industry?

The crypto market is keenly observing the developments within the Upbit case. As of now, the regulators haven’t decided the extent of sanctions, including the possible fines. The industry expects explanations from Upbit on January 21, which would lead to further decisions in the case. Usually, the authority could impose up to 100 million won ($68,592) for violations of customer verification regulations.

South Korea has been at the forefront of crypto regulations, driven by its vision of fostering market expansion and customer security. Its recent efforts highlight its commitment to tackling increasing illegal crypto practices in the country. Further developments in the case could significantly impact the global crypto regulatory landscape.

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Nynu V Jamal

Nynu V Jamal is a passionate crypto journalist with three years of experience in blockchain, web3, and fintech spheres. She has established herself as a knowledgeable and engaging voice in the cryptocurrency and blockchain space. Her experience as an Assistant Professor in English Language and Literature has further added to her quest for crafting informative, well-researched, and accessible content.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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Nasdaq Files 19b-4 for Canary Litecoin ETF Amid Approval Speculation

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2 hours ago

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January 22, 2025

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Nasdaq has submitted a 19b-4 form to the U.S. Securities and Exchange Commission (SEC) for the proposed Canary Litecoin ETF. This filing, made on behalf of Canary Capital, starts the official review process for the approval of a spot Litecoin exchange-traded fund (ETF). 

The submission is a crucial step in the regulatory process and could pave the way for Litecoin to join Bitcoin and Ethereum as the next cryptocurrency with an approved ETF in the United States.

Nasdaq Files 19b-4 for Canary Litecoin ETF

The 19b-4 form was filed by Nasdaq on January 16 while Canary Capital had submitted an amended S-1 filing earlier in the week. These two filings thus address all the essential elements the SEC considers while evaluating the ETF proposal.

As stated in the submission, U.S. Bancorp Fund Services, LLC will perform the function of the fund administrator and U.S. Bank N.A will oversee the cash of the ETF. Coinbase Custody Trust Company LLC will act as the custodian of the Litecoin of the fund.

The 19b-4 filing is the first official step that exchange agencies take to receive the SEC’s stamp of approval on ETFs. This filing thus begins the formal 240-day period within which the SEC can either approve the application, reject it, or ask for more information.

Bloomberg Senior ETF Analyst Eric Balchunas termed the filing as a “positive signal” in a recent post in X, which indicates that Litecoin might be the next cryptocurrency to get the green signal for a spot ETF.

Litecoin Price Rallies as SEC Prepares for Change

The filing occurs at a time when the SEC is in the process of changing leadership under the new government under President-elect Donald Trump. Former SEC Commissioner Paul Atkins who has been an advocate for cryptocurrencies has been recommended for the position following Gensler’s exit. This shift in leadership can be an opportunity for a more positive approach to cryptocurrency ETFs, according to industry experts.

Balchunas noted the change of leadership and said that it is a “huge variable” in the approval of Litecoin and other ETFs. Canary Capital has been in the process of seeking approval of Litecoin ETF since October 2024 and in the process of addressing the regulatory issues in its filings.

When the news broke, the cryptocurrency market gave a positive reaction, especially to Litecoin, which surged more than 15% within 24 hours. On-chain analytics firm Santiment revealed that large investors with holdings of over 10,000 LTC scooped up an additional 250,000 LTC over the last week, thus fuelling market sentiment in favor of Litecoin.

Competition Among Spot Crypto ETFs Intensifies

As Litecoin is moving forward in the ETF race, other cryptocurrencies like Solana and XRP are not far behind in the race. Solana is currently leading in the race, with several companies, including VanEck, Grayscale, and Bitwise, having submitted 19b-4 forms for spot Solana ETFs as early as November 2024.

Grayscale’s Solana ETF is expected to get a preliminary nod from the SEC by January 23, while other Solana ETFs are set to have their filings due later this month.

The applications for Ripple’s XRP ETFs are also pending with WisdomTree, Bitwise, 21Shares, and Canary Capital among others. If approved, Solana and XRP ETFs are expected to lure investments of up to $14 billion in their first year of operation, according to the experts.

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Kelvin Munene Murithi

Kelvin is a distinguished writer with expertise in crypto and finance, holding a Bachelor’s degree in Actuarial Science. Known for his incisive analysis and insightful content, he possesses a strong command of English and excels in conducting thorough research and delivering timely cryptocurrency market updates.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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