Ripple and SEC make peace: fine reduced to $50 million – XRP benefits from legal clarity

Ripple and SEC make peace: fine reduced to $50 million – XRP benefits from legal clarity

Ripple and SEC settle dispute: A new chapter for XRP

After years of litigation between Ripple Labs and the US Securities and Exchange Commission, an agreement has been reached. Ripple has agreed to pay a $50 million fine, a significant decrease from the $125 million it originally asked for. In response, the SEC withdrew its appeal and requested that the court order “comply with the law” be set aside. This development marks the end of a conflict that has plagued the crypto world since the end of 2020.

Background of the conflict

The dispute was sparked by the SEC's allegations that Ripple had conducted an unregistered securities offering by selling XRP. These allegations led to XRP being temporarily delisted from trading by numerous major exchanges, including Coinbase, Binance and eToro. As a result, the XRP price experienced a sharp decline, which led to considerable uncertainty among investors.

Legal clarity for Ripple and XRP

Despite the high legal costs, which are estimated at up to $200 million, Ripple can see the legal clarity it has now gained as a big plus. A court had already decided in 2023 that the sale of XRP on secondary markets should not be classified as securities trading. This ruling remains valid and gives Ripple the opportunity to operate without constant regulatory concerns.

This decision also offers hope for other crypto projects. Many companies had held back from expanding their businesses in the U.S. due to uncertainty surrounding regulatory challenges from the SEC.

Criticism of the SEC and the strengthened image of Ripple

There are significant critical voices regarding regional and national regulation, particularly regarding SEC boss Gary Gensler. Observers accuse him of focusing on small regulatory efforts while more significant risks in the crypto industry, such as the collapse of FTX or Celsius, went unmonitored. The Ripple case makes it clear that not every crypto project automatically violates the law and shows that there is an urgent need to create clearer framework conditions.

Stuart Alderoty, Ripple's chief lawyer, expressed his relief at the outcome of the proceedings on the X platform (formerly Twitter). He assumes that this settlement marks the end of the legal disputes. The $50 million now to be paid is already in an escrow account, and the balance of the originally requested amount will be transferred back to Ripple.

Conclusion

The agreement between Ripple and the SEC could be the start of a comeback for XRP. With the legal clarity gained and the appeals withdrawn, both Ripple and other crypto projects can focus on potential new growth opportunities in the USA. The developments suggest that the regulatory landscape for cryptocurrencies could become more transparent and clearer in the future.