XRP Removal from NY Greenlist: Top Attorney Looks to Sue NYDFS

A prominent pro-crypto lawyer has commented on removing XRP from the New York Department of Financial Services (NYDFS) greenlist, disclosing plans to take legal action against the NYDFS.

James “MetaLawMan” Murphy, a U.S.-based legal expert, remains committed to transparency around the NYDFS’ removal of XRP from its Greenlist last year. The Virginia-based attorney has disclosed plans to sue the NYDFS for refusing to clarify the reason behind XRP’s removal.

In a recent post on X, Murphy revealed that the NYDFS has failed to provide any information surrounding the decision to delist XRP from the Greenlist last September. According to the lawyer, the agency has not released any documents in response to his FOIL request.

UPDATE:
The @NYDFS has refused to produce a single document in response to my FOIL request.

Last week, I initiated an administrative appeal of this decision with the DFS.

I expect the DFS Appeals Office will reject my appeal in the next week or two.

My next step then will be… https://t.co/RRt5WaXy28

— MetaLawMan (@MetaLawMan) March 4, 2024

The Crypto Basic reported in January that Murphy filed a Freedom of Information Law (FOIL) request with the NYDFS, seeking transparency on the reason behind the New York regulator’s decision to remove XRP from the Greenlist.

Now, nearly two months after the report, Murphy claims the agency has refused the request for information. According to him, he has appealed the decision from the NYDFS. However, the attorney believes this appeal would also be futile, resulting in a rejection in two weeks or less.

Nonetheless, Murphy already has his next step planned out. He revealed that following the rejection of the appeal, he would charge the NYDFS in a court in New York, looking to compel the agency to clarify why it removed XRP from its Greenlist despite the token attaining legal clarity.

XRP Journey to Legal Clarity

Recall that Judge Analisa Torres declared XRP a non-security in her pivotal ruling in the Ripple vs. SEC case last July. Judge Torres ruled that XRP is not a security despite confirming that Ripple sold the asset in unregistered security offerings to institutional investors.

The decision triggered euphoria within the XRP community, as it would help bolster legal and regulatory clarity for the asset. However, two months after the ruling, the NYDFS removed XRP from its Greenlist alongside other assets in September 2023, bringing the total number of regulated assets to eight.

For the uninitiated, the Greenlist is a list of virtual currencies approved for custody by licensed entities in New York. The removal of XRP means that licensed entities in New York would no longer be able to custody or offer services related to the asset without obtaining separate approval. 

Such removal is typically due to regulatory concerns, asset status changes, or other factors that the NYDFS deems relevant to consumer protection and financial stability. However, the New York regulator has failed to specify the reason behind XRP’s removal.