The SEC’s case against Ripple for selling XRP as an unlicensed security will begin with a pretrial in February 2021.
The United States District Court of the Southern District of New York has fixed Feb. 22, 2021 as the date for the pretrial of the lawsuit filed by the Securities and Exchange Commission against Ripple Labs and its principal actors.
According to a court document filed on Tuesday, counsel representing all parties on the matter will hold a telephone pretrial conference. As part of preparations for the preliminary hearing, the parties in the case will submit a joint letter a week before the pretrial date addressing:
“(1) a brief description of the case, including the factual and legal basis for the claim(s) and defense(s), (2) any contemplated motions and (3) the prospect for settlement.”
Earlier in December, the SEC filed a lawsuit against Ripple, accusing the blockchain firm of selling XRP tokens in violation of securities law. The legal status of XRP as a commodity or a security has long been the subject of debate within and outside the crypto space.
Several cryptocurrency exchanges have reacted to the lawsuit by either suspending XRP trading or delisting the token from their platforms altogether. Investment firms like Bitwise Asset Management have also liquidated their XRP holdings in the wake of the SEC enforcement action.
As previously reported by Cointelegraph, Ripple partner MoneyGram distanced itself from the company, asserting that it does not utilize RippleNet. The XRP price has also declined significantly, down over 65% in December.
In a statement issued earlier in the week, Ripple accused the SEC of harming XRP token holders. Ripple also declared its intention to respond to the Commission’s claims against the company.