SAN FRANCISCO, CA / ACCESSWIRE / October 1, 2021 / Ripple, the leading provider of enterprise blockchain and cryptocurrency solutions for global payments, is pleased to announce that the SEC vs RIPPLE legal battle is finally over. The lawsuit that lasted over ten months has finally been settled between the Securities and Exchange Commission (SEC) and the cryptocurrency company Ripple. The SEC has announced it would drop its charges.
The legal case against Ripple
In the lawsuit filed against RIPPLE and two of its executive leaders, the SEC announced on December 22, 2020, that it had "filed an action against Ripple Labs inc. and two of its executives, who are also significant security holders, alleging that they raised over 41.3 billion through unregistered, ongoing digital asset securities offering."
The complainant also alleged that "Christian Larsen, the company's co-founder, executive chairman of its board, and former CEO; and Bradley Garlinghouse, the company's current CEO, raised capital to finance the company's business. The complaint alleges that Ripple raised funds, beginning in 2013, through the sale of digital assets known as XRP in an unregistered securities offering to investors in the U.S. and worldwide."
Insights
Shedding more light on why the regulatory agency made that move, the Director of Enforcement Division of SEC, Stephanie Avakian explained that "We allege that Ripple, Larsen, and Garlinghouse failed to register their ongoing offer and sale of billions of XRP to retail investors, which deprived potential purchasers of adequate disclosures about XRP and Ripple's business and other important long-standing protections that are fundamental to our robust public market system."
In response to the allegations and lawsuit, RIPPLE hired former SEC chair and experienced financial securities lawyer, Mary Jo White, as its legal representative. The former SEC chair and U. S attorney for the Southern District of New York criticized her previous employer harshly stating that: "As a former U.S. attorney and SEC chair, you know that when it takes that long to figure out a case you probably shouldn't be bringing it. It's not something I would do walking out the door." She added that the SEC is "wrong legally and factually."
The route ahead
After 10 months of intense battle, the regulatory body has finally dropped the lawsuit against the crypto giant and its executives. This provides reassurance to the entire cryptocurrency industry and highlights the point that the XRP ledger could not be classified using a decades-old framework (the Howey-Test).
Earlier this month, RIPPLE's CEO, Brad Garlinghouse, expressed the crypto company's desire to come to a peaceful reconciliation with SEC given that the regulatory body can define what Ripple actually is. He said: "To the extent we can find a constructive path forward with the SEC, we, of course, want to find that. There's no scenario though that we're going to settle unless there's absolute certainty about what XRP is on a go-forward basis."
Even prior to the settlement, former U.S treasurer Rosie Rios had made a case for twitter, taking to twitter that XRP's primary purpose was facilitating cross-border payments. That came together with 2 SEC chairs publicly stating a lack of clarity on digital asset regulation, and various high-profile experts criticizing the SEC's stance on this case.
Much-needed reassurance, for investors and the broader public
With their new freedom from the lawsuit, RIPPLE and its executive team can now focus on providing the best services to the cryptocurrency community; especially to passionate RIPPLE investors who have shown unrelenting faith in the crypto company over the years, so much so that they've become known as the Ripple Army.
This outcome is a win not only for Ripple, but a positive sign for the rest of the cryptocurrency space. Recently, some exchanges had de-listed, or limited trading of the digital asset. With the case settled, "exchange listing skepticism will be disregarded, and more XRP liquidity transfers will start in the U.S. market."
While more details on the case are yet to emerge to the broader public, the SEC dropping the case sets a necessary precedent for cryptocurrencies to flourish in the US market.
About Ripple
Ripple enables payments everywhere, every way, for everyone using the power of crypto and blockchain. By joining Ripple's growing global network (RippleNet), financial institutions can process their customers payments anywhere in the world instantly, reliably and cost-effectively. Banks and payment providers can use the digital asset XRP to further reduce their costs and access new markets.
Website: https://ripple.com/
Twitter: https://twitter.com/Ripple
Media Contact:
Eric van Miltenburg
Chief Business Officer
https://ripple.com/contact/press/
SOURCE: Ripple Labs inc
