In another turn in the legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC), the SEC has filed a motion for final judgment, requesting the court to impose significant financial penalties on Ripple.
The SEC alleges that Ripple’s sale of XRP, its native cryptocurrency, constituted an unregistered securities offering. Ripple vehemently contests this claim, arguing that XRP functions as a utility token and doesn’t meet the criteria of security under U.S. law. This disagreement forms the core of the ongoing lawsuit.
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A ruling from July 2023 determined that Ripple did not violate securities laws with its non-institutional XRP sales. The SEC is looking to impose a penalty on Ripple for institutional sales of the digital asset.
The SEC is seeking approximately $2 billion from Ripple, including disgorgement of allegedly ill-gotten gains, prejudgment interest, and civil penalties. This hefty price tag has drawn criticism from Ripple executives and the cryptocurrency community, who view the request as excessive and lacking justification.
The ramifications of this case extend far beyond Ripple and XRP. Legal experts and market observers are closely following the proceedings, as many believe the outcome of the lawsuit could significantly affect XRP’s price. However, not everyone shares this belief, as a legal expert recently revealed that XRP can reach its all-time high in 2024 regardless of the amount Ripple pays as a penalty.
Despite this, many community members still believe that a favorable ruling for Ripple in the form of a small fine could help XRP’s climb. Conversely, a large penalty could significantly hamper XRP’s short-term growth.
Despite the ongoing legal uncertainty, XRP’s price has exhibited a surprising degree of resilience, staying above $0.6. This suggests that some investors remain confident in XRP’s future and believe Ripple will prevail.
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Ripple’s Defense Against SEC’s Final Judgment Motion
With the SEC’s motion for final judgment on the table, Ripple is now preparing its formal opposition to be presented before the court in the coming weeks. This marks a critical juncture in the case, as the arguments presented by both parties will directly influence Judge Analisa Torres’s final decision.
The outcome of this courtroom clash holds significant weight for both Ripple and the broader cryptocurrency market. If the SEC gets its way, it might be emboldened to continue its problematic enforcement strategy.
Despite criticism from Federal Judges, the SEC has continued with its strategy of waging costly legal battles against cryptocurrency companies. However, a decisive loss in the XRP lawsuit could slow the regulator down and open the door to reasonable crypto regulations in the U.S.
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