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BREAKING: Ripple to Settle $125M in Civil Penalties as SEC Lawsuit Potentially Ends

The years-long Ripple vs. SEC lawsuit may likely be over following the federal court’s latest ruling.

Avatar image of Mishael Nwani Mishael Nwani•August 7, 2024
Breaking News

United States District Judge Analisa Torres has just ordered the global payment company Ripple to pay a $125 million civil penalty to end its lawsuit against the American regulatory watchdog, the Securities and Exchange Commission (SEC). With this ruling, XRP is no longer regarded as security, and the four-year-long lawsuit between Ripple and SEC has ended.

The latest ruling follows months of back-and-forth deliberation on the civil penalty pricetag. The SEC had previously insisted on a $2 billion fine. However, the payment company opposed this, requesting a $10 million fine instead.

Commenting on the latest turn of events, Ripple’s CEO Brad Garlinghouse wrote in a tweet:

“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.”

Ripple vs. SEC

In 2020, the SEC, under the administration of its current chair, Gary Gensler, sued Ripple and its former CEO, Chris Larsen, and current CEO, Brad Garlinghouse, over allegations of unlawfully offering the XRP token to investors in a purported initial public offering (IPO).

The financial agency argued that XRP was a security, a financial instrument that must be registered under the SEC before being offered to U.S.-based investors. Ripple, on its part, insists that XRP is a cryptocurrency and does not fall under the category of security tokens. This debate has lingered between the duo for years.

In July 2023, the blockchain payment company partially won the SEC in court over the lawsuit. The court decision at the time allowed various crypto exchanges, including U.S.-based platforms, to list XRP. Since then, Ripple doubled down in its efforts to end the lawsuit against the financial watchdog.

XRP Jumps 20%

Notably, Ripple’s XRP has seen a rapid 20% boost above $0.6 at press time. Its market cap, above $34.2 billion, puts the payment cryptocurrency in the sixth-largest position among leading crypto assets.

Source: CoinStats

Mishael Nwani

Mishael Nwani is an avid crypto enthusiast with nearly four years of experience in the industry. Since 2022, he has covered topics across cryptocurrencies, NFTs, artificial intelligence, and financial markets.