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5 minutes ago, SquaryBone said:

It's the difference between gifting to a separate organization and gifting from group A to group A with a different name. Escrow has nothing to do with it.

Funny how the founder also heads this so-called separate organization. If Vitalik wasn't heading the board, I might agree.

Just how the Gates Foundation doesn't really enrich Bill Gates at all, it's a like completely separate thing, yup. Just how tax-exempt mega-church's owners aren't driving around in Lambos and what not because their church is a non-profit and they're not skimming money to enrich themselves.

We can hide behind the legalese of it but let's not be naive and pretend like that these are 100% unrelated organizations like Exxon-Mobile and Joe's Bait n Tackle.

This is how the elite protect themselves and their money, legalese, loopholes and laundering, paid for by law lobbying no less.

Was Ethereum/Ethereum Foundation as developed as it was when Novogratz ponied up the cash for his 500,000 ETH? No, Vitalik said as much, the guy bought in early as an investor. Then they used the cash towards developing Ethereum, however they want to sugar coat it.

The legalese doesn't change the fact the Foundation sold ETH to enrich/re-invest in themselves/Ethereum by way of an early investor who profited from his investment, no different than the accusations the SEC is making about Ripple. But let's cherry pick cases and go on a witch hunt.

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I need to clarify this after some more thinking about the topic and having listened to a number of different views on the issue. Just to go back to what Hellerstein said in the Kik judgement: T

https://ripple.com/wp-content/uploads/2020/12/Ripple-Wells-Submission-Summary.pdf Summary of Ripple’s Wells Submission I. Introduction A. The SEC’s theory, that XRP is an investment c

Ripple needs to show that XRP is not a security by demonstrating that the Howey test does not apply to XRP. They will probably also try any other legal manoeuvre available to chip away at the evidence

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1 hour ago, Pablo said:

This is what some crypto lawyers have referred to a "pyrrhic" victory whereby the SEC "technically" wins elements of the case, hits Ripple and execs with fines, obtains some amount of disgorgement but essentially leaves Ripple and XRP intact. That seems to be the pattern so far. 

The one exception to previous cases is that Ripple appears ready to fight this all the way - if they lose but appeal and decide to push a new "Ripple Rule", then all bets are off. If that happens, we could be watching this case for several years.

Really appreciate your contributions and the valuable insights you provide and the time you dedicate to the matter. It's really how I see it as well. Without having a legal background, the issue in a nutshell is that technically XRP is not a security but the offering makes it look like one. That reminds me of a quote by an SEC officer who stated that "if it sounds like a duck and it flies like a duck, probably it is a duck". This statement already worried me months ago.

I'm wondering if this presumed "victory on points", rather than a KO, by the SEC could lead to the awareness by Ripple executives that a fight that lasts years is not convenient and might compromise their development more than the probably harsh conditions offered by the SEC in their settlement proposals, whatever these are, i.e. fines and the stop sales by Ripple and executives.

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1 hour ago, Pablo said:

Apologies - yes, I was referring to the SEC.

I think the odds of the SEC coming away with some type of win are reasonably high. They might not get everything they want but they will likely come away with some type of victory.

By that I mean that given the recent caselaw, there's a pretty good chance they convince a court that some form of investment contract was offered. They probably won't be able to prove that XRP itself was a security because the token itself lacks some important features of an investment contract. For starters, XRP is not a contract.

However if the court can see past those hurdles and consider what Hellerstein in Kik referred to as the "economic reality" of Ripple's sales of XRP in the early years (say between 2012-2017), including the public comments made by Ripple, the inducements to market makers and partners etc, then the SEC's chances of success of proving some type of investment contract at some point in Ripple's past are much higher. And that's all they really need in order to fine Ripple, Brad and Chris and seek disgorgement.

This is what some crypto lawyers have referred to a "pyrrhic" victory whereby the SEC "technically" wins elements of the case, hits Ripple and execs with fines, obtains some amount of disgorgement but essentially leaves Ripple and XRP intact. That seems to be the pattern so far. 

The one exception to previous cases is that Ripple appears ready to fight this all the way - if they lose but appeal and decide to push a new "Ripple Rule", then all bets are off. If that happens, we could be watching this case for several years.

The only problem with that is, and DS said it himself... they don’t have that much time to accomplish what they want, or something to that affects. If this takes a few years, competition  will slip under the door and are ahead. 

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On 1/8/2021 at 2:38 PM, Rutski said:

The only problem with that is, and DS said it himself... they don’t have that much time to accomplish what they want, or something to that affects. If this takes a few years, competition  will slip under the door and are ahead. 

Exactly. And that to me makes the risk higher and reward lower on XRP. They could have settled but they didn't. This case should have been started years ago and we might have had clarity by now. But now RIpple probably can only settle which might again keep us in the "regulatory unclarity".

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Attorney Jeremy Hogan discusses how even a judgement against Ripple, BG and CL would not necessarily be terrible for XRP:

Lawyer Discusses the Likely Result of SEC v. Ripple and Its Effect on XRP (YouTube)

He says it's notable in the SEC Prayer for Relief that they have not asked for a Declaratory Judgement that XRP is a security. That is not their aim; they want to punish the three parties, but not prevent the use of XRP.

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15 hours ago, PunishmentOfLuxury said:

Attorney Jeremy Hogan discusses how even a judgement against Ripple, BG and CL would not necessarily be terrible for XRP:

Lawyer Discusses the Likely Result of SEC v. Ripple and Its Effect on XRP (YouTube)

He says it's notable in the SEC Prayer for Relief that they have not asked for a Declaratory Judgement that XRP is a security. That is not their aim; they want to punish the three parties, but not prevent the use of XRP.

Good share. On the down side, it seems like they'd have to go through their "rule-making body" to actually get definitive clarity on if XRP is/isn't a security. Clearly not to most people, but they need it on the books.

Is basically an entirely separate process from violations enforcement (lawsuit), so who knows how long that could take. And they've had 8 years to go through the rule-making process, with many pleas from Ripple for clarity, but haven't lifted a finger at all. :dash1:

Edited by jetbrzzz
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On 1/12/2021 at 1:21 PM, jetbrzzz said:

Good share. On the down side, it seems like they'd have to go through their "rule-making body" to actually get definitive clarity on if XRP is/isn't a security. Clearly not to most people, but they need it on the books.

Is basically an entirely separate process from violations enforcement (lawsuit), so who knows how long that could take. And they've had 8 years to go through the rule-making process, with many pleas from Ripple for clarity, but haven't lifted a finger at all. :dash1:

My suspicion is that this is actually the process that has been pursued for years, and is probably already done - but it is sitting on the shelf waiting for the SEC to collect on this new direction. It would not surprise me to find that this clarity is being held up until the SEC collects on penalties.

Edited by jag216
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3 hours ago, jag216 said:

My suspicion is that this is actually the process that has been pursued for years, and is probably already done - but it is sitting on the shelf waiting for the SEC to collect on this new direction. It would not surprise me to find that this clarity is being held up until the SEC collects on penalties.

Gooberment inefficiency at its finest. This is why governments don't innovate anything.

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5 hours ago, jetbrzzz said:

Gooberment inefficiency at its finest. This is why governments don't innovate anything.

Society innovates/changes faster than regulatory bodies can keep up with. It's therefore easier for them to leapfrog the regulations. Unfortunately, this means that they're basically always behind the innovators, that clearly need the regulations. What stings, is the dickish move to then sue the innovators for applying the older, existing, but not perfectly fitting regulations to whatever they were doing.

Edited by Gambaard
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On 1/10/2021 at 1:15 PM, SquaryBone said:

Exactly. And that to me makes the risk higher and reward lower on XRP. They could have settled but they didn't. This case should have been started years ago and we might have had clarity by now. But now RIpple probably can only settle which might again keep us in the "regulatory unclarity".

To update my own post: the prayer of relief indeed doesn't ask for XRP being deemed a security or not. So whatever happens it seems this case will not bring regulatory clarity.

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