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In the latest development of the ongoing legal saga between Ripple Labs and the United States Securities and Exchange Commission (SEC), Ripple’s Chief Legal Officer, Stuart Alderoty, has revealed that the SEC is seeking a hefty $2 billion penalty against the blockchain firm.
The SEC’s request for the substantial fine was disclosed by Alderoty in a post on March 25, with the details of the filing under seal until March 26. This civil case against Ripple has been unfolding since the SEC’s initial filing in 2020.
Alderoty criticized the SEC’s approach, accusing the regulator of overstepping its authority and aiming to intimidate Ripple and the wider industry. He expressed confidence in the court’s fairness during the remedies phase.
Ripple intends to respond to the SEC’s request in April, with Alderoty asserting that the regulator has been misleading in its statements. Ripple CEO Brad Garlinghouse also condemned the SEC’s actions, emphasizing the unprecedented nature of the proposed $2 billion fine and pledging to continue challenging the regulator’s assertions.
The SEC’s lawsuit, filed in December 2020, alleged that Ripple had conducted unregistered securities sales amounting to $1.3 billion through its XRP token offerings. However, a significant ruling in July 2023 by Judge Analisa Torres determined that XRP was not a security in certain contexts, which led to the dismissal of charges against Garlinghouse and co-founder Chris Larsen in October 2023.
Despite this development, the SEC’s legal battles with crypto firms persist, with ongoing civil lawsuits against prominent entities such as Coinbase, Binance, and Kraken.
This latest revelation underscores the high stakes and contentious nature of the legal proceedings between Ripple and the SEC, with significant implications for the cryptocurrency industry as a whole.