🚨⚖️ SEC DEMANDS $102.6 MILLION FROM RIPPLE IN XRP CASE ⚖️🚨
The U.S. Securities and Exchange Commission (SEC) is now pursuing a $102.6 million penalty from Ripple, significantly reduced from the nearly $2 billion initially sought.
🔍 The SEC has responded to Ripple Labs’ request for a lower penalty in the ongoing XRP case. Ripple suggested a penalty of no more than $10 million, referencing the Terraform Labs settlement. Initially, the SEC sought nearly $2 billion in a final judgment against Ripple.
SEC's Clarification:
In a letter to District Judge Analisa Torres on June 14, the SEC explained that comparing the penalty to the Terraform Labs settlement is inappropriate as Terraform Labs is bankrupt and has agreed to significant measures, including burning “the keys to all of its crypto asset securities,” returning funds to investors, and removing board members involved in the violations.
The SEC says that Ripple has not agreed to any similar measures.
📉 SEC’s Position on Penalty Amount:
Ripple’s Conduct:
The SEC argued that Ripple’s continued conduct and failure to acknowledge violations justify a higher penalty.
The regulator noted that “resolutions where cash-strapped defendants agree to return funds to victims quickly and voluntarily cease their violative conduct are unhelpful” in deciding penalties for a wealthy defendant like Ripple.
Comparison to Terraform:
Ripple compared the size of the Terraform penalty to its gross sales, but the SEC stressed this is not an accurate comparison.
The SEC highlighted that the penalty should be compared to the gross profit of the violative conduct. For Terraform, the ratio was 11.7% ($420 million/$3.587 billion).
Calculation for Ripple:
Applying the 11.7% ratio to Ripple’s $876.3 million in gross profits results in a $102.6 million penalty.
The SEC concluded that a $10 million penalty “would not satisfy the purposes of the civil penalty statutes.”
Stay updated with @Professor Mende - Founder of BONUZ Project - in Dubai UAE