The article discusses Ripple’s legal battle and highlights the risks for XRP holders. The SEC’s loss in this case is seen as on shaky ground and likely to be appealed. The court divided Ripple’s offering into three categories: Institutional Sales, Programmatic Sales, and Other Sales. The court ruled that XRP was a security when sold to institutional investors, making it an unlawful sale of securities. Ripple will have to pay a penalty for this violation, and these investors are entitled to rescission. The court also rejected Ripple’s due process defense but acknowledged the crypto industry’s concerns about inconsistent messages from the SEC. The court rejected Ripple’s attempt to introduce a new test called the “Essential Ingredients Test.” For programmatic sales, the court ruled that XRP was no longer a security when sold anonymously to exchanges. However, this ruling is seen as troubling as it goes against traditional notions of investing. The court’s distinguishing of tokens awarded to employees and third parties in the third category is also criticized. XRP token holders face uncertainty due to the court ruling, which could lead to significant returns of XRP and impact its market value. The author clarifies that the views expressed in the article are for informational purposes only and do not constitute financial advice.

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