U.S. federal judge Annalisa Torres ordered Ripple Labs to pay a $125 million fine for selling XRP tokens without proper registration. Despite the hefty fine, the financial burden faced by Ripple is far less than the $2 billion originally requested by the U.S. Securities and Exchange Commission (SEC).
The decision ends a long-running battle with the SEC that has captured the attention of the cryptocurrency industry.
Ripple CEO and Chief Legal Officer Reacts to Landmark Legal Victory
The case began in 2020, when the SEC accused Ripple of raising funds through the sale of unregistered Ripple, claiming that the digital tokens were securities. The U.S. Securities and Exchange Commission subsequently filed a lawsuit against Ripple in December 2020, creating serious legal challenges for the company.
Read more: Everything you need to know about Ripple and the SEC
However, Judge Torres’s ruling on August 7 stated that Ripple’s actions had nothing to do with fraud, which had a significant impact on the final fine.
The ruling also prohibits Ripple from further violating securities laws in the future and ensures future compliance with securities laws, bringing much-needed clarity to the industry regarding its regulatory stance on digital tokens.
Ripple CEO Brad Garlinghouse lowered the SEC’s request by about 94% to show respect for the court’s ruling. He also expressed relief that Ripple can now continue to grow its business.
“This ruling is a victory for Ripple, the industry, and the rule of law. The SEC’s strong opposition to the entire XRP community is now gone,” Garlinghouse said on his X (Twitter).
Ripple Chief Legal Officer Stuart Alderotti commented on the court’s decision, emphasizing that there were no allegations of fraud or willful misconduct in the case, and no financial losses were reported.
“We respect the court’s imposition of a $125 million fine for certain past sales to complex third parties,” Adroti noted.
Learn More: Ripple (XRP) Price Prediction 2024/2025/2030
Ripple’s price surged following the court ruling, rising from $0.5018 to $0.6373, a 27% increase in just 1 hour and 30 minutes. Currently, the price of XRP has stabilized and is trading at $0.6171.
