Ripple Continues to Gain Edge Against SEC - XRP Accelerates

The U.S. Securities and Exchange Commission (SEC) has withdrawn its lawsuit targeting Ripple executives, now focusing solely on the case against the company.

Ripple Continues to Gain Edge Against SEC - XRP Accelerates. Photo: CNBC

According to early morning reports on October 20 (Vietnam time), the SEC has dropped its lawsuit against Ripple CEO Brad Garlinghouse and Executive Chairman Chris Larsen. Previously, the SEC had accused the two Ripple leaders of aiding the company in violating securities laws.

Garlinghouse commented:

"For nearly three years, Chris and I have been unjustly targeted. Instead of prosecuting criminals who steal customers' money on foreign exchanges, the SEC has scrutinized individuals who have done good."

Ripple Labs' Chief Legal Officer Stuart Alderoty expressed a clear stance:

"The SEC made a serious error and has now capitulated by dismissing all charges against our executives. This is not just a settlement but a clear surrender by the SEC."

Ripple Executive Chairman Chris Larsen also added:

"Today, we have been legally vindicated and rescued from the cryptocurrency money strangulation in the U.S. It's been a farce that we've had to defend ourselves from an attack that has been flawed since its inception."

Today's decision effectively cancels a trial scheduled for next year and marks another legal victory for the cryptocurrency company in a case that has spanned three years. However, it should be noted that the SEC still retains complaints against Ripple.

SEC initially sued Ripple at the end of 2020, alleging that Ripple illegally raised $1.3 billion through XRP sales. As of July this year, SEC suffered a setback against Ripple when the court ruled that XRP was not a security and stated that XRP could only be considered a security in direct sales to investment funds or third parties.

The SEC subsequently appealed to the court but ultimately had its appeal rejected in the latest ruling, as the judge found that the SEC did not provide sufficient evidence for its argument.

XRP has risen nearly 10% following the latest developments and is currently adjusting around $0.51.

Chart: 15-minute XRP/USDT pair on Binance at 09:00 AM on October 20, 2023

Katherine Kirkpatrick, Chief Legal Officer of Cboe Digital, believes that regulatory bodies are not merely dismissing lawsuits against individuals but employing legal tactics.

"They could have appealed against Ripple much sooner, or they would have to wait until the end of that trial in late spring next year."

SEC appears to be on weaker ground in pursuing cryptocurrency companies that they have categorized as securities law violators. SEC Chairman Gary Gensler argued that nearly all cryptocurrencies are securities and fall within the agency's jurisdiction, but U.S. judges have repeatedly stated that it is not that simple.

To put it bluntly, in the absence of crypto regulations from Congress, battles like these may help the government establish standards for digital asset access.

On the other hand, Ripple indicates that it is almost entirely focused on its business activities outside the United States, accounting for 90% of its operations.