A federal judge dealt a significant blow on 13 July to Security and Exchange Commission chair Gary Gensler’s quest to bring the crypto industry to heel, but securities law experts warn that the legal and political implications of the decision are difficult to predict and may not prove to be a lasting victory for investors in digital assets.

US District Judge Analisa Torres ruled that Ripple Labs’ crypto token, XRP, is not a security when sold on digital asset exchanges to the general public, but that Ripple’s sales to sophisticated institutional investors did qualify as an unregistered sale of investment contracts, in violation of federal law.