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Finally the long term since 4 year ongoing battle between the American securities regulatory body and Ripple firm has been over.
Ripple is a San Francisco-headquartered fintech firm known for its blockchain and XRP cryptocurrency-powered, highly efficient payment services. In December 2020, the United States Securities and Exchange Commission (SEC) sued Ripple for operating payment services via XRP cryptocurrency and selling XRP, along with multiple other allegations against Ripple. The SEC also raised questions over the nature of XRP cryptocurrency, claiming its use violated the Securities Act, as XRP was considered a security token under the SEC’s purview.
As per the latest court ruling, Ripple won the battle against the SEC’s charges & allegations but faced $123 million penalty in civil penalties.
The court ruled that Ripple violated securities laws through its “Institutional Sales” of the XRP cryptocurrency, which were deemed to be unregistered investment contracts. However, the court ruled that Ripple’s “Programmatic Sales” and “Other Distributions” of XRP did not constitute unregistered securities offerings.
Crypto law expert Jeremy Hogan called this court ruling a very big win for Ripple firm.
Ripple CEO Brad Garlinghouse said that the SEC was demanding a $2 billion fine from Ripple based on false fraud allegations, but the court ruling clarified how the SEC was misusing its power.
The SEC asked for $2B, and the Court reduced their demand by ~94% recognizing that they had overplayed their hand. We respect the Court’s decision and have clarity to continue growing our company.
This is a victory for Ripple, the industry and the rule of law. The SEC’s…
Ripple’s legal expert Stuart Alderoty also said that the court rejected the SEC’s claims that Ripple acted recklessly and noted there were no allegations of fraud or financial harm. The court dismissed the SEC’s demand for $2 billion in fines, instead imposing a $125 million fine for specific past sales to sophisticated third parties.
A final judgment. The Court rejects the SEC’s suggestion that Ripple acted recklessly and she reminds the SEC that this case did not involve any allegations of fraud or intentional wrongdoing, and no one suffered any financial harm. She rejects the SEC’s absurd demand for $2B in… https://t.co/RbwpBnoXJG
— Stuart Alderoty (@s_alderoty) August 7, 2024XRP price action
Following this news, the trade price of the XRP coin surged from $0.49 to $0.64, representing a 30% increase. At the time of writing this article, the trade price of the XRP coin is 20% higher.
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