Judge denies XRP Army a seat at the table in SEC v. Ripple case

XRP tokenholders' attempts to insert themselves as third-party defendants in the United States Securities and Exchange Commission’s case against Ripple may have come to an end.

U.S. District Judge Analisa Torres has denied a motion filed over the weekend on behalf of more than 6,000 XRP holders. The motion to intervene argued that the interests of tokenholders — in this case, the XRP Army — were not being adequately represented in the lawsuit against Ripple and its executives.

John Deaton of Deaton Law Firm first filed the motion on Sunday, later claiming on the firm’s website that XRP holders had suffered $15 billion in losses following the Securities and Exchange Commission’s announcement of its lawsuit against Ripple. The price of XRP fell more than 60% from $0.58 to $0.21 in December 2020, but has since risen to $0.48 at the time of publication.

Torres denied the motion “without prejudice,” meaning that lawyers representing XRP investors may be able to refile in the future. The filing included a pre-motion letter to the SEC giving them an opportunity to respond.

According to court rules, the SEC is allowed three business days to respond to any such motion, but has requested an extension until March 22. It is unclear whether this extension would also allow any legal team representing XRP tokenholders to file another motion to intervene. If not granted though, XRP investors may not have a seat at the table going forward in the SEC’s case against Ripple.

Last year, the SEC charged Ripple CEO Brad Garlinghouse and co-founder Chris Larsen with conducting an "unregistered, ongoing digital asset securities offering" for their XRP sales. Many crypto exchanges have since announced they would suspend the trading of XRP, or delist the token entirely. Global money transfer service MoneyGram has also terminated its long-standing partnership with Ripple.