The legal matter involving blockchain company Ripple Labs and the US Securities and Exchange Commission (SEC) may be nearing its conclusion following more than four years, pending court endorsement.
As per a March 25 post on X from chief legal officer Stuart Alderoty, which may be “the final update on SEC v. Ripple ever,” the executive stated that Ripple will withdraw its cross-appeal against the SEC in the US Court of Appeals for the Second Circuit. A judgment from the US District Court for the Southern District of New York in August 2024 holding Ripple responsible for $125 million will essentially remain intact, but the SEC will retain only $50 million of that in escrow — the rest will be refunded to Ripple.
“The agency will also petition the Court to revoke the standard injunction that was previously implemented at the SEC’s behest,” Alderoty mentioned. “All dependent on Commission vote, the preparation of final documents, and standard court procedures.”
Statement from Ripple chief legal officer regarding recent developments in SEC case. Source: Stuart Alderoty
Alderoty’s declaration came less than a week after Ripple CEO Brad Garlinghouse indicated that the SEC would withdraw its appeal concerning the August 2024 ruling. At the moment of publishing, neither the SEC nor Ripple seemed to have submitted any documents in the Second Circuit since January 31 or in SDNY since October.
The Ripple CLO informed Cointelegraph on March 11 that an agreement between both Ripple and the SEC to withdraw their individual appeal and cross-appeal would allow the lower court’s $125-million ruling to persist. However, both parties could approach SDNY Judge Analisa Torress to seek a modification of the ruling “hand-in-hand.”
Related: Coinbase requests appeals court to determine that crypto trades are not securities
The situation remains ambiguous regarding whether Ripple also plans to forfeit its appeal concerning a July 2023 court ruling that mainly designated XRP sales to retail investors as unregistered securities. Cointelegraph reached out to Ripple for clarification but did not receive a reply at the time of publication.
Ripple’s Engagement in Politic
The SEC v. Ripple case, initiated by the commission under US President Donald Trump in December 2020, stands as one of the agency’s longest-running enforcement actions against a prominent US cryptocurrency company.
Garlinghouse stated during an interview that aired in December 2024 that the company might not have engaged as deeply in US politics if a different individual had been at the helm of the commission instead of former SEC Chair Gary Gensler, even though the Ripple case was filed under then-Chair Jay Clayton.
Throughout the 2024 electoral cycle, Ripple contributed $45 million to the political action committee Fairshake to back “pro-crypto” candidates and committed $5 million in XRP to Trump’s inauguration fund. Alderoty hinted to Cointelegraph that the SEC’s decision to drop cases was “independent” of any political contributions.
Since the November 5 election, where Trump triumphed over then-Democratic Vice President Kamala Harris, Garlinghouse and Alderoty have participated in events in Washington, DC during the inauguration as official attendees, and the CEO was present at a March 7 summit at the White House where the US President discussed his strategies for stablecoins and a regulatory framework for cryptocurrency.
On March 27, members of the Senate Banking Committee will deliberate on the nomination of former SEC Commissioner Paul Atkins to possibly return to lead the agency. He is anticipated to encounter inquiries regarding his views on cryptocurrency regulation and potential conflicts of interest.
Magazine: Ripple claims SEC lawsuit ‘resolved,’ Trump at DAS, and more: Hodler’s Digest, March 16 – 22
