(Bloomberg) -- Ripple Labs Chief Executive Officer Brad Garlinghouse said that a federal court decision Thursday means that its crypto token XRP “is not a security,” giving the digital-payments company more freedom to pursue various business opportunities.

Speaking on Bloomberg TV, Garlinghouse said the ruling means he no longer has to worry about promoting the various use cases for Ripple and its technology. Ripple is used in cross-border payments and in implementing central bank digital currencies, and 95% of its customers are located outside of the US, he said.

A federal judge ruled Thursday that XRP is a security when sold to institutional investors but not the general public. The long-awaited decision was hailed a victory for the crypto industry over the US Securities and Exchange Commission, which sued Ripple in late 2020.

“I have heard from hundreds of people throughout the industry, there’s just broad enthusiasm and excitement, this is the first time the SEC lost a crypto case,” Garlinghouse said. “The SEC has been a bully.”

US District Judge Analisa Torres in New York said the crypto firm’s $729 million in sales of its XRP token to sophisticated investors met the test for an investment contract under federal securities law, but that didn’t apply to hundreds of million sold to the broader public through exchanges. Back in 2020, the SEC accused the company, co-founder Chris Larsen and Garlinghouse of misleading investors by selling more than $1 billion worth of tokens without registering them. 

The rationale for the duality in the Ripple ruling is that in many instances retail buyers had no idea where their money was going or what it was being used for, in contrast to sophisticated institutions. One big question is whether that logic will survive possible appeals or gain ground in other legal battles.

The agency is expected to appeal the case, but any appeals could take years, Garlinghouse said.

SEC spokesperson Scott Schneider said Thursday that the agency is “pleased that the court found that XRP tokens were offered and sold by Ripple as investment contracts in violations of the securities laws.” The regulator was continuing its review of the decision, he said.

XRP’s price almost doubled after the decision was announced Thursday. The token retreated about 15% to around 69 cents as of 2:41 p.m. in New York. 

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