Speculation about the possible seizure of XRP tokens from Ripple's escrow accounts was firmly denied by the company’s legal counsel. Additionally, technical aspects of transferring tokens under government control are being examined.
Bill Morgan Responds to Seizure Rumors
Bill Morgan, Ripple’s legal counsel, dismissed claims by analyst John Squire that the US government could seize XRP tokens from the company’s escrow accounts. His blunt response, 'No it won’t,' sent a clear message regarding the improbability of such actions.
Technical Transfer Mechanisms for XRP
An XRPL validator known as 'Vet' outlined a theoretical mechanism for transferring escrowed XRP to government control. This process involves changing the key of the escrow account to a government-controlled address, allowing for transfer through a single transaction. However, Ripple senior software engineer Mayukha Vadari noted significant limitations with this approach, stating, 'Wouldn’t work if you only wanted to do a partial transfer, though — it’s an all-or-nothing solution.'
Ongoing SEC Settlement Process
Morgan provided updates on the SEC v. Ripple settlement negotiations, which began with Ripple signing an agreement on April 23 followed by SEC approval on May 8. The parties successfully obtained court approval to hold appeals in abeyance through June 16. However, the settlement process faced procedural complications, with Judge Torres initially denying the first joint motion due to technical errors. A second joint motion addressing Rule 60 requirements was filed on June 12 seeking proper court approval for the settlement terms. The agreed settlement reduces Ripple’s fine to $50 million and dissolves the injunction against XRP sales. Upon completion, both the appeal and cross-appeal will be dismissed, ending the multi-year litigation.
The situation surrounding Ripple and XRP tokens continues to evolve amidst seizure rumors and legal battles with the SEC. The systematic approach to distributing XRP from escrow and ensuring market stability remains crucial for investors and institutional users.
