Following a scoop shared by the FOX Business journalist Eleanor Terrett on Thursday, a rumor that the SEC could settle with Ripple over the XRP lawsuit was back in the spotlight.
Eleanor Terrett wrote that her sources told her the SEC was going to make a big announcement on Friday after a closed meeting scheduled for 2 pm ET on Thursday. According to her, the announcement is expected to adversely affect the entire crypto industry.
The FOX Business journalist tweeted: “SCOOP: My SEC sources tell me to be prepared for a potentially big announcement tomorrow. Could it have something to do with a Kraken exchange settlement following a closed meeting at 2 pm? Could settlement terms have industry ramifications? We’ll see.”
Ripple-SEC Settlement Rumor
In response to the scoop shared by Terrett, several XRP proponents asked whether the expected announcement related to a settlement between the United States Securities and Exchange Commission and Ripple, the San Francisco-based cross-border payment firm.
“Does it have anything to do with the Ripple lawsuit?” one user wrote. “Could it be a Ripple settlement?” another inquired. These questions seemed unwarranted as Ripple CEO Brad Garlinghouse previously stated the one condition that would make them settle with the SEC. Likewise, John Deaton, a pro-XRP supporter, revealed that there would be no settlement in the XRP lawsuit until Summary Judgment is given by Judge Analisa Torres, probably by the second quarter of 2023.
However, a subsequent update from Terrett revealed that the matter was about an unregistered security case filed by the U.S. SEC against Kraken, a top United States-based centralized exchange. Unlike Ripple, which was determined to battle with the SEC in court, Kraken opted for an immediate settlement.
But seems it may be coming today: https://t.co/wTQ2XoN5qj
— Eleanor Terrett (@EleanorTerrett) February 9, 2023
Kraken Settles With SEC Over its Saas Program
Particularly, the big announcement turned out to be the shutting down of Kraken’s Staking-as-a-Service (SaaS) program on Thursday by the Gary Gensler-led SEC.
The SEC charged the two Kraken entities with failing to register the offer and sale of their crypto-asset staking-as-a-service program, levying them $30 million in disgorgement, prejudgment interest, and civil penalties.
“Whether it’s through staking-as-a-service, lending, or other means, crypto intermediaries, when offering investment contracts in exchange for investors’ tokens, need to provide the proper disclosures and safeguards required by our securities laws,” said SEC Chair Gary Gensler. “Today’s action should make clear to the marketplace that staking-as-a-service providers must register and provide full, fair, and truthful disclosure and investor protection,” he added.
SEC commissioner Hester Peirce, who believes the financial regulator would lose against Ripple and also admitted that her SEC colleagues performed shorthand analysis on XRP, frowned at the latest action from Gensler.
“Today, the SEC shut down Kraken’s staking program and counted it as a win for investors. I disagree and therefore dissent,” Hester Peirce said.
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