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HomeCrypto NewsMarketXRP Holders’ Attorney Reveals The "Fear" That Prompted Him to Sue SEC

XRP Holders’ Attorney Reveals The “Fear” That Prompted Him to Sue SEC

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Deaton reveals why he sued the SEC.

Attorney John Deaton, the founder of Crypto Law, has disclosed the major fear that prompted him to file a suit against the Securities and Exchange Commission (SEC). 

According to Deaton, in a scenario where the Judge in charge of the ongoing lawsuit between the SEC and Ripple rules on the Fair Notice Defense after declaring XRP security, XRP holders will become the victim. He added that he was forced to sue the SEC based on such a scenario.

Most likely now, it won’t happen but there was a scenario where the SEC wins but Ripple doesn’t have to pay much. The judge could say XRP was and is a security but Ripple didn’t get fair notice so doesn’t have to pay. XRP Holders get screwed. That fear was one reason I sued the SEC,” Deaton said.

The Crypto Law founder added that the Fair Notice Defense would act as an insurance policy for Ripple in such a scenario. The move will come into play if the blockchain company loses “the security” litigation.

Deaton said if the court declares XRP security and rules that Ripple did not get Fair Notice, no United States-based exchange will re-list the cryptocurrency. He fears that if such an unfortunate event happens, U.S.-based XRP holders will use alternative means to sell the token.

First, I’m not saying it is going to happen – I don’t believe it will – I predict it won’t. But in that scenario, you would have a token deemed a security with Ripple but gives you zero rights or interest in Ripple. No exchange would relist, have to be a dealer broker to sell, etc,” he added

Deaton Fighting to Protect XRP Holders’ Interest

It is worth mentioning that Deaton has engaged the SEC in a legal battle to protect the interest of XRP holders in the Ripple litigation.

In a tweet made in August, Deaton claimed XRP holders lost $15 billion because the SEC decided to brand all XRP, including secondary market sales, as securities instead of limiting the charges to Ripple. This resulted in many U.S.-based cryptocurrency exchanges, including Coinbase and Kraken, delisting XRP, putting pressure on the token’s price.

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Ammara Mubin is a cryptocurrency reporter and trader with vast experience in the industry. Mubin has written several news stories related to the crypto industry, including non-fungible tokens (NFTs), decentralized finance (DeFi), fundraising, mining, etc. Her major focus is covering regulatory events that are capable of shaping the entire crypto ecosystem.

Disclaimer: The content is for informational purposes only, may include the author's personal opinion, and does not necessarily reflect the opinion of TheCryptoBasic. All Financial investments, including crypto, carry significant risk, so always do your complete research before investing. Never invest money you cannot afford to lose; the author or the publication does not hold any responsibility for your financial loss or gains.

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