SEC Requests Hefty $2 Billion Penalty Against Ripple Labs Amid Ongoing Legal Battle
Summary:
Stuart Alderoty, Ripple Labs Chief Legal Officer, has reported that the US SEC is seeking a $2 billion penalty against Ripple, in a legal wrangle that started in 2020. The SEC's claim that Ripple raised $1.3 billion via unregistered securities through XRP token sales is complicated by a July 2023 ruling that XRP isn't a security. Despite, Ripple's contention that the SEC is spreading misleading communication, the regulatory body continues to hold legal disputes with other major crypto firms in the US.
Stuart Alderoty, chief legal officer at Ripple Labs, has announced that the US Securities and Exchange Commission (SEC) has appealed to a federal judge for a colossal penalty of $2 billion against the blockchain entity. Alderoty revealed in an X posting on March 25 that the SEC approached the judge to impose a staggering fine of $2 billion upon Ripple, as part of a legal filing that remained under wraps until March 26. The legal battle between SEC and Ripple has been in process since the initial filing by the SEC in 2020. Alderoty stated that instead of applying the law impartially, the SEC seems determined to scare and penalize Ripple and the broader industry, expressing hopes that the Court will judge the situations fairly during the remedies phase.
The chief legal officer also mentioned that Ripple Labs intends to respond to the SEC's appeal in April, while criticizing the regulatory body for spreading misleading and false statements. Previously on March 18, a Utah-based judge penalized the SEC for providing evidence with malintent against the company Debt Box. Ripple CEO Brad Garlinghouse expressed his disbelief towards the $2-billion fine suggested by the SEC, stressing that there is no existing precedent for such an action.
The legal case against Ripple, launched by SEC in December 2020, accused the company and its co-founders Brad Garlinghouse and Chris Larsen of accumulating $1.3 billion in unlawful securities through XRP token sales. In July 2023, Judge Analisa Torres declared that XRP didn't qualify as a security in relation to systematic sales on digital asset trading platforms. This judgement might have influenced the SEC's decision to withdraw charges against Garlinghouse and Larsen in October 2023.
However, SEC maintains ongoing legal disputes with other crypto organizations in the US, including renowned names like Coinbase, Binance, and Kraken. Evidently, American enforcement authorities are intensifying their crackdown on illicit activities related to cryptocurrency.
Published At
3/25/2024 11:03:42 PM
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