Ripple Rejects SEC's $2 Billion Fine, Citing Terraform Labs Case as Example.

Ripple Labs has stated that it intends to reduce its own financial penalties by citing penalties imposed on Terraform Labs in a separate but related SEC case. The #SEC accuses Ripple of selling $1.3 billion of #XRP in unregistered securities transactions and is seeking a punitive $2 billion penalty.

Amid the ongoing legal dispute with the SEC, Ripple has consistently emphasized that the financial penalties proposed by the regulatory body are disproportionate. In a recent statement, Ripple noted that Terraform Labs, which was subject to similar scrutiny, received a significantly lower penalty despite more serious charges. Terraform was fined $4.47 billion, which was later approved by a judge. Ripple's legal team points out the inconsistencies in the SEC's penalty calculations, stating that the penalty should be around $10 million.

Ripple's lawyers argue that the striking difference in penalties reveals an inconsistency in the SEC's approach. “The SEC's demands in the Ripple case stand in sharp contrast to penalties imposed in similar or more severe cases,” they said. They cited the Terraform case as an example, stating that fines imposed on companies in similar situations generally account for only 0.6% to 1.8% of their gross revenues.

In its defense, Ripple also emphasizes that, unlike Terraform Labs and its founder Do Kwon, #Ripple has not been accused of fraud. The SEC's argument is based on unregistered securities sales, not deceptive practices. “Although there was no fraud and the harm to institutional investors was minimal, the SEC's proposed penalties are excessive,” the defense team said. So far, the SEC has not responded to Ripple's latest allegations.
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