In a recent update to Ripple Labs’ ongoing legal tussle with the U.S. Securities and Exchange Commission, the discussion around penalty figures has reignited. Ripple’s Chief Legal Officer, Stuart Alderoty, took a firm stand against the SEC’s revised fine proposal, emphasizing the company’s resolve to contest overbearing regulatory demands. This comes after the SEC considerably lowered its initial punitive demand from $2 billion to $102 million.
The @SEC is raging. Ripple defended itself – “agreeing to nothing.” The court gave clarity that XRP is not a security. There are no “victims” to compensate. And worst of all for the @SEC, Ripple is thriving. But at least @SEC seems to have abandoned its absurd demand for $2B. https://t.co/KVSkB9OqlH
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— Stuart Alderoty (@s_alderoty) June 15, 2024
SEC’s Aggressive Demands Met With Firm Resistance
The SEC’s initial claim aimed at imposing a hefty fine on Ripple, arguing for a strong deterrent against potential regulatory violations. However, Ripple has countered these allegations, maintaining that their operations have not resulted in any harm or victimized any parties. This stance is part of Ripple’s broader strategy to mitigate the financial and operational impacts of the SEC’s claims.
Alderoty’s fiery rhetoric described the SEC’s approach as “raging,” a choice of words that underscores the intensity of Ripple’s defense against what they perceive as unwarranted regulatory aggression. Ripple’s comparison between their case and the Terraform Labs litigation, where the SEC secured a $4.47 billion settlement under drastically different circumstances, further highlights their argument that the penalty should be considerably less punitive.
Ripple has proposed a penalty of just $10 million, which starkly contrasts with the much higher figures suggested by the SEC. This highlights the significant differences in how each views the severity of the alleged violations. Ripple argues that, unlike Terraform Labs, it has maintained financial solvency and transparency, factors it believes should mitigate the proposed penalties.
Terraform Labs Settles for $4.7B, Announces Closure
According to a recent Crypto2Community report, Terraform Labs agreed to a monumental $4.5 billion settlement with the U.S. Securities and Exchange Commission, concluding a protracted legal battle over allegations of fraud and the sale of unregistered securities. This settlement, announced by CEO Chris Amani on June 12, marks a significant chapter in the blockchain company’s history, leading to its eventual dissolution.
Consequently, Terraform Labs will begin liquidating its assets, which include notable projects like Pulsar Finance, Station Wallet, and Enterprise DAO. These assets are slated for transfer to various digital asset management firms as part of the company’s orderly winding down of operations.
Moreover, the Terra and Terra Classic blockchains are set to continue operations despite Terraform Labs’ dissolution. They will transition to a community-led governance model that CEO Chris Amani believes could set a new precedent for blockchain management following a crisis.
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Disclaimer: Cryptocurrency is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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