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 Ripple Labs is gearing up to challenge the U.S. Securities and Exchange Commission’s (SEC) appeal of a recent court ruling that declared its retail sales of XRP did not violate securities laws.
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Ripple’s CEO, Brad Garlinghouse,<a style="color: #0000ff;" href="https://twitter.com/bgarlinghouse/status/1841597085264839113?t=rmvVr6hIy0P7EcVyBsLAvw&amp;s=19" rel="noopener noreferrer nofollow"> voiced</a> his frustration in an October 3 post on X, vowing to fight the SEC’s efforts to classify XRP as a security. Garlinghouse described the SEC’s appeal as “misguided and infuriating,” emphasizing that Ripple, the crypto industry, and the rule of law had already prevailed in the matter.
The SEC’s<a style="color: #0000ff;" href="https://drive.google.com/file/d/1Job37I5FlzZeSZ5AYUdrOX6JqbPDZTyV/view?usp=drivesdk" rel="noopener noreferrer nofollow"> appeal</a>, filed on October 2, contests a July 13<a href="https://www.courtlistener.com/docket/19857399/874/securities-and-exchange-commission-v-ripple-labs-inc/" rel="noopener noreferrer nofollow"> ruling</a> by Judge Analisa Torres of the Southern District Court of New York. In that ruling, the court determined that XRP’s sale to retail investors did not constitute an illegal securities offering under the Howey test. However, Ripple’s institutional sales were found to have violated securities laws, leading the SEC to propose a $1.95 billion penalty, which Judge Torres later reduced to $125 million. Ripple was also required to register with the SEC if it wished to offer securities in the future.
Ripple and the SEC reached an<a style="color: #0000ff;" href="https://drive.google.com/file/d/1JvTCBXUwZLHwe_UQ8gAYBmugwHVNeP5s/view?usp=drivesdk" rel="noopener noreferrer nofollow"> agreement</a> for a stay order on September 4, which allowed Ripple to deposit 111% of the $125 million penalty into a secure account while the appeal process played out. This move postponed the payment and signalled the SEC’s intention to pursue an appeal.
Legal experts like Fred Rispoli, founder of Hodl Law,<a href="https://twitter.com/freddyriz/status/1841595392917700715?t=81nvkK1KDW9CwVYhVkG6Nw&amp;s=19" rel="noopener noreferrer nofollow"> speculate</a> that the appeals process could be lengthy, with a ruling from the Second Circuit appeals court unlikely before early 2026.
Ripple’s Chief Legal Officer, Stuart Aldertoy,<a href="https://twitter.com/s_alderoty/status/1841596012588114116?t=J9_3MZfD-0RUkYoLFZwhvg&amp;s=19" rel="noopener noreferrer nofollow"> called</a> the SEC’s appeal “unsurprising” and accused the agency, along with its chair, Gary Gensler, of engaging in “litigation warfare” against the crypto sector. Aldertoy<a style="color: #0000ff;" href="https://twitter.com/s_alderoty/status/1841596012588114116?t=J9_3MZfD-0RUkYoLFZwhvg&amp;s=19" rel="noopener noreferrer nofollow"> suggested</a> that Ripple might pursue a cross-appeal if necessary.
Meanwhile, Gensler has faced significant criticism from U.S. lawmakers over the SEC’s aggressive enforcement strategy towards the crypto sector. In particular, the agency’s vague language regarding digital assets, including Ethereum, was called into question i<a href="https://judiciary.house.gov/sites/evo-subsites/republicans-judiciary.house.gov/files/evo-media-document/2024-09-10%20JDJ%20PM%20JC%20to%20SEC%20re%20Political%20Hires%20%281%29.pdf" rel="noopener noreferrer nofollow">n a recent open letter</a> to Gensler himself.&nbsp;
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RELATED: <a style="color: #0000ff;" href="https://defi-planet.com/2024/10/ripple-gains-in-principle-approval-to-expand-services-in-the-uae/" rel="noopener noreferrer nofollow">Ripple Gains In-Principle Approval to Expand Services in the UAE</a>
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The post <a href="https://defi-planet.com/2024/10/ripple-labs-to-challenge-u-s-sec-appeal-on-xrps-non-security-status/" rel="noopener noreferrer nofollow">Ripple Labs to Challenge U.S. SEC Appeal on XRP’s Non-Security Status</a> appeared first on <a href="https://defi-planet.com" rel="noopener noreferrer nofollow">DeFi Planet</a>.

Ripple Labs to Challenge U.S. SEC Appeal on XRP’s Non-Security Status

DeFi Planet

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