Victory for Ripple: SEC drops charges
After more than four years, the US Securities and Exchange Commission (SEC) has dropped its lawsuit against Ripple.
After more than four years, the US Securities and Exchange Commission (SEC) has dropped its lawsuit against Ripple. This was announced by Ripple CEO Brad Garlinghouse on X:
The SEC had sued Ripple and its founders in December 2020. The regulator accused the company of engaging in unregistered securities trading by selling XRP.
In July 2023, a court ruled that selling XRP to retail investors did not violate U.S. securities laws. However, sales to institutional investors were considered illegal. As a result, Ripple was fined $125 million.
The SEC disagreed with this ruling and appealed in August 2023. Now that the SEC has withdrawn this appeal, however, it remains unclear whether Ripple will agree. Attorney Jeremy Hogan pointed this out in a View post on Xon X.
According to Hogan, there are four possible scenarios:
- Ripple continues its appeal, requiring an appellate court to rule on the legal definition of investment contracts.
- Ripple withdraws appeal, after which the case goes back to court and both sides try to review the ruling.
- Ripple withdraws appeal and both parties settle without adjusting the judgment.
- Ripple pays $125 million fine and closes the case.
Regardless of which scenario materializes, this is a big win for Ripple. Consequently, the market is reacting enthusiastically: the XRP price shot up and at the time of writing stands at $2.52 - up 13% in the past 24 hours.
