Ripple Labs’ chief legal officer, Stuart Alderoty, has revealed that the United States Securities and Exchange Commission (SEC) has requested a $2 billion penalty against the blockchain firm. In a post on March 25, Alderoty stated that the SEC made this request as part of a filing that was under seal until March 26. The civil case against Ripple has been ongoing since the SEC filed it in 2020.
Alderoty expressed his concerns about the SEC’s approach, stating, “Rather than faithfully apply the law, the SEC remains bent on wanting to punish and intimidate Ripple – and the industry at large. We trust the Court will approach the remedies phase fairly.”
The chief legal officer also mentioned that Ripple plans to file a response to the SEC’s request in April. However, he criticized the regulator for making false and misleading statements. Alderoty accused the SEC of trading in misinformation.
Ripple CEO Brad Garlinghouse also commented on the situation, referring to the $2 billion fine as unprecedented. He stated, “We will continue to expose the SEC for what they are when we respond to this.”
The SEC’s lawsuit against Ripple, Garlinghouse, and co-founder Chris Larsen was filed in December 2020. The regulator alleged that the firm raised $1.3 billion in unregistered securities through the sale of XRP tokens. However, in July 2023, Judge Analisa Torres ruled that XRP was not a security in relation to programmatic sales on digital asset exchanges. This ruling led to the SEC moving to dismiss charges against Garlinghouse and Larsen in October 2023 with prejudice.
It is worth noting that the SEC has ongoing civil lawsuits against other cryptocurrency firms in the United States, including Coinbase, Binance, and Kraken. The regulatory agencies in the US are intensifying their efforts to combat crypto-related crime.