The ongoing debate between legal experts surrounding the sales of Ripple XRP continues to heat up. In December 2020, the United States SEC charged Ripple and two of its execs with selling unregistered securities in the form of XRP. This sparked a discussion amongst legal professionals about the implications of Ripple's XRP sales, which saw the company raise $1.3 billion. Pro-XRP lawyer John Deaton and former SEC attorney Marc Fagel have engaged each other in a debate over the charges filed by the securities regulator.

Fagel argued that based on his 30 years of experience, the SEC is correct to allege that Ripple violated Section 5 of the Securities Act via its XRP sales. He suggested that the SEC has a better summary judgment argument than Ripple, though he stressed that a favorable ruling for Ripple wouldn't necessarily be out of the ordinary. In response, attorney Deaton conceded that most Altcoins' initial sales violate Section 5. Though Deaton has a problem with the way the SEC laid out its argument, which might implicate secondary market transactions, he noted that it was precisely this issue that drove him to become amicus counsel on behalf of tech journalist Naomi Brockwell in the SEC vs. LBRY lawsuit.

Deaton also shared excerpts of the amicus curiae brief he wrote which highlights his concessions regarding Ripple's potential violations of Section 5 and measures to protect investors. The attorney asserted that the SEC has overstepped its bounds by arguing that "Ripple has engaged in the functional equivalent of a nine year-long, ongoing, 24/7 ICO" and that "each and every sale of XRP, from anywhere in the world, was, is, always has been, and always will be a security." Such an argument, he stated, "implicates secondary market sales of XRP" and overbroadly data points related to the sale that travel through space and time, back into the past and even into the future. Lastly, Deaton concluded that while Fagel and other SEC lawyers can argue that Ripple violated section 5 at some point, they cannot argue that the SEC’s current argument is supported by the law or protects investors.

The heated debate continues to spread throughout media and legal outlets as the XRP community waits for a final verdict from the judge, which is expected to come at any time. Australian-based lawyer Bill Morgan recently urged XRP holders to engage Fagel politely as the future of Ripple's XRP hangs in the balance.



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