US federal judge Analisa Torres has fined Ripple Labs $125 million for selling its XRP token without proper registration. Despite the hefty fine, Ripple was left with a much smaller financial burden than the Securities and Exchange Commission (SEC) had originally demanded: nearly $2 billion.
This decision ends a long-running battle with the SEC that has caught the attention of the crypto industry.
Ripple CEO and CLO react to groundbreaking legal victory
The case began in 2020 when the SEC accused Ripple of raising money through unregistered sales of XRP, claiming that the digital token was a security. The agency then filed a lawsuit against Ripple in December 2020. This put Ripple in a serious legal challenge.
Read more: Everything you need to know about Ripple vs. SEC
However, Judge Torres’ August 7 ruling found that Ripple’s actions did not amount to fraud. Consequently, the decision had a significant impact on the final sentence.
The ruling also prohibited Ripple from further violations of the Securities Act and ensured that it will continue to comply with securities laws in the future. Indeed, this ruling has brought much-needed clarity to the industry regarding the regulatory stance towards digital tokens.
Ripple CEO Brad Garlinghouse showed his respect for the court’s decision by reducing the SEC’s demand by about 94%. He also expressed his relief that the company now has the clarity to continue to grow its business.
“This is a victory for Ripple, the industry, and the rule of law. The SEC backlash against the entire XRP community is over,” Garlinghouse said on his Twitter post.
Stuart Alderoty, Ripple’s general counsel, commented on the court’s decision. He stressed that the case did not contain any allegations of fraud or intentional misconduct and that no financial damage had been reported.
“We respect the $125 million fine imposed by the court for certain historical sales to sophisticated third parties,” Alderoty noted.
Read more: Ripple (XRP) Price Prediction 2024/2025/2030
Following the court’s decision, the XRP price saw a significant increase. It rose from $0.5018 to $0.6373, a 27% increase in just an hour and a half. At the time of writing, the XRP price has stabilized and is currently trading at $0.6171.
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