The U.S. District Court for the Southern District of New York ruled that Ripple Labs must pay a $125 million fine for violating U.S. securities laws in a case brought by the Securities and Exchange Commission (SEC).
District Judge Analisa Torres determined that Ripple Labs was guilty of multiple securities law violations and, as part of the settlement with the SEC, ordered the company to pay a civil penalty of $125 million within 30 days.
Despite the company’s admission of guilt on several charges, Ripple CEO Brad Garlinghouse called the court’s decision a “victory for Ripple, the industry, and the rule of law.” The key point is that the SEC initially sought a $2 billion penalty, but the court’s ruling cited an independent analysis of Ripple Labs’ financial report, previously mandated by the court, which revealed that only 1,278 transactions were in violation. Consequently, the civil penalty was set at $125,035,150.
Ripple CLO Stuart Alderoty stated that the court’s decision to reduce the SEC’s proposed penalty by 94% demonstrates that further regulatory attacks on the XRP community would be pointless. According to him, the court only considered “certain historic sales to sophisticated third parties,” meaning XRP wasn’t deemed a security on a broader scale. Ripple Labs Co-Founder Chris Larsen also expressed hope that this ruling would lead to the complete closure of the SEC case and end the regulator’s battle with the cryptocurrency.
The ruling also included a court order that legally prohibits Ripple Labs from committing further securities law violations. Therefore, Ripple Labs must cease any activities that the court deemed to be in violation of these laws. In Judge Torres’s view, the company could sooner or later “cross the line,” and the court must account for such a possibility.
XRP surged by approximately 26% following the announcement of the court’s decision. According to CoinGecko data, the asset’s price rose from $0.50 to $0.63 within a few hours. As of 4:00 p.m. (GMT+3), XRP was trading at $0.61.
The SEC filed its lawsuit against Ripple in December 2020, accusing the company of using XRP as an unregistered security to raise funds. Initially, the lawsuit also included charges against Brad Garlinghouse and Chris Larsen, but the regulator dropped these claims in 2023. In July 2023, the court ruled that the XRP token isn’t a security when sold to retail investors.
Сообщение Ripple to Pay $125 Million Fine to Settle SEC Case появились сначала на CoinsPaid Media.