After dropping charges against Ripple executives CEO Brad Garlinghouse and Chairman Chris Larsen, the United States Securities and Exchange Commission (SEC) has reportedly stated that the battle on the classification of XRP still continues.
The SEC’s Resilience
The latest development shared by Fox Business journalist Eleanor Terrett highlights information from sources close to the SEC. Despite the charges against Garlinghouse and Larsen being dropped, other aspects of the case, including the classification of all offers and sales of XRP as an investment scheme, are still in play. This update signifies that SEC Chair Gary Gensler is committed to pursuing the case further.
Read Also: Ripple Attracts Major Players Following Victory Against SEC. Is XRP Rally Imminent? Details
Eleanor Terrett tweeted, “NEW: Sources close to the SEC tell me that while the charges against Brad Garlinghouse and Chris Larsen have been dropped, all other parts of the case, including the classification of all offers and sales of XRP as an investment scheme, remain on the table.”
🚨NEW: Sources close to the @SECGov tell me that while the charges against @bgarlinghouse and @chrislarsensf have been dropped, all other parts of the case, including classification of all offers and sales of $XRP as an investment scheme, remain on the table.
Seems @GaryGensler…
— Eleanor Terrett (@EleanorTerrett) October 20, 2023
What Are Next Steps in XRP Lawsuit?
In another post, Terrett outlines the critical points of the case. She said although the SEC has dropped charges against Ripple’s key figures, Garlinghouse and Larsen, the battle is far from over.
According to legal experts, the penalty phase is up next. Ripple is expected to engage in a significant legal tussle with the SEC regarding the appropriate penalty for its $700 million in XRP sales to institutional investors.
Terrett highlights the expectation that Ripple will attempt to reduce the penalty while the SEC will likely seek a substantial amount for “bragging rights.” The battle between the two parties is expected to be fierce, and Terrett reports, “Expect a big fight.”
🚨SO, what are next steps in the @Ripple case?
Now that the @SECGov has dropped the charges against @bgarlinghouse and @chrislarsensf, expect to see some more litigation in the penalty phase between the two parties in regards to the appropriate penalty for Ripple‘s $700M+ of… https://t.co/4jJAzKtTjp
— Eleanor Terrett (@EleanorTerrett) October 19, 2023
The SEC still has an option to appeal Judge Torres’s decision related to the programmatic sales and other distributions of XRP, further indicating that the legal proceedings are far from over.
Terrett drew attention to the denial of the SEC’s interlocutory appeal. The judge stated that the SEC would have to wait until after the trial before appealing. The journalist said, “Now there is no trial the SEC could potentially appeal after the penalty phase.”
Terrett acknowledges that this development is a significant victory for Ripple and the broader crypto industry, while the SEC faces another setback.
Read Also: XRP Lawsuit: Judge Torres Says The SEC Presents “Shifting and Inconsistent Arguments” Against Ripple
Analyzing the Situation
The dropping of charges against Ripple’s key figures is undoubtedly a win for Ripple and the cryptocurrency industry. However, the battle is far from over, with the penalty phase expected to be a major point of contention. The potential for an SEC appeal after the penalty phase further complicates things for XRP’s future.
Gensler is determined to continue the fight. As Terrett points out, the crypto industry is celebrating this latest development as a victory. However, the struggle between Ripple and the SEC remains a key point of interest for crypto enthusiasts and legal experts.
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