NEW YORK, Monday, May 13, 2024 – The ongoing legal battle between the SEC and Ripple Labs took a significant turn recently as the SEC filed its final response in the remedies phase of the lawsuit. The SEC’s filing raises concerns about Ripple’s past compliance and questions the effectiveness of their proposed operational changes.1
The SEC argues that Ripple’s historical activities in selling and distributing XRP tokens suggest a need for stricter legal oversight. They specifically refute Ripple’s claims of acting without recklessness, highlighting inconsistencies in their past compliance efforts. The SEC views Ripple’s proposed reformatting of XRP sales based on the lawsuit’s outcome with skepticism.
The SEC’s response delves deeper, questioning Ripple’s commitment to future compliance. They view Ripple’s proposal to limit XRP sales to non-U.S. markets and accredited investors as an attempt to avoid stricter regulations, even though similar past attempts were deemed insufficient.
Additionally, the SEC criticizes Ripple’s suggested changes to On-Demand Liquidity (ODL) sales contracts, arguing these limitations are inadequate to address previous breaches.
In response to the SEC’s criticisms, Ripple’s Chief Legal Officer, Stuart Alderoty, expressed concerns about the SEC’s approach to regulation. He compared the SEC’s actions to a simplistic licensing system, suggesting international regulators with established crypto frameworks would find it puzzling. Despite the legal challenges, Alderoty remains optimistic about a favorable outcome.
- dropbox.com: https://www.dropbox.com/scl/fi/uvoe3wqksdkvhdg1xrbqz/SEC-Redacted-Remedies-Reply-Brief.pdf?rlkey=4bpb3rnm6le549e12gizhcypf&e=3&dl=0[↩]
