US SEC seeks $2 billion from Ripple Labs over sales of XRP

In posts on X, Ripple Chief Legal Officer Stuart Alderoty said the regulator has asked U.S. District Judge Analisa Torres in Manhattan for the penalties in court papers filed under seal

The U.S. Securities and Exchange Commission is seeking fines and penalties totalling $2 billion in its case against Ripple Labs over sales of the crypto currency XRP, the firm’s chief legal officer said in a social media post on Monday.

In posts on X, Ripple Chief Legal Officer Stuart Alderoty said the regulator has asked U.S. District Judge Analisa Torres in Manhattan for the penalties in court papers filed under seal. The Securities and Exchange Commission was scheduled to file the documents publicly with redactions on Tuesday.

Rather than faithfully apply the law, the Securities and Exchange Commission remains bent on wanting to punish and intimidate Ripple – and the industry at large, Alderoty added.

Torres ruled in July that the blockchain firm’s sale of XRP worth $728.9 million to hedge funds and other sophisticated buyers amounted to unlawful sales of unregistered securities.

Ripple is scheduled to file a reply in April.

The Securities and Exchange Commission sued Ripple, its CEO Brad Garlinghouse and co-founder Chris Larsen in 2020, accusing them of illegally raising over $1.3 billion in an unregistered securities offering by selling XRP.

The Securities and Exchange Commission dropped its remaining claims against Garlinghouse and Larsen in October.

The case has been keenly watched, as it is among the biggest brought by the SEC in the crypto currency space.

While the Securities and Exchange Commission partly won the case, Torres dealt the regulator a high-profile setback when she ruled that XRP Ripple sold on public crypto currency exchanges did not meet the legal definition of a security.

Torres rejected the SEC’s request to repeal that ruling while the case is in progress. But the regulator may appeal once the judge decides its request for penalties.

Other crypto firms facing SEC lawsuits, including major exchanges Coinbase and Binance, have pointed to Torres’ ruling in urging other judges to dismiss the regulator’s claims.

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