Ripple Labs Chief Legal Officer Stuart Alderoty is celebrating a significant victory as the Securities and Exchange Commission (SEC) has chosen to dismiss all charges against its executives, including CEO Brad Garlinghouse and co-founder Chris Larsen. This marks a turning point in the long-standing legal battle between Ripple and the SEC.
Alderoty expressed his satisfaction with the outcome, emphasizing,
“The SEC made a serious mistake going after Brad & Chris personally – and now, they’ve capitulated, dismissing all charges against our executives.”
He went on to clarify that this dismissal should not be misconstrued as a settlement but rather as a surrender by the SEC.
The lawsuit, which has been ongoing since 2020, originally accused Ripple of illegally raising $1.3 billion through the sale of its cryptocurrency, XRP. This dispute revolved around the classification of XRP as a security or not.
What’s Next for Ripple After SEC’s Move?
The recent decision by the SEC to drop the charges against Ripple’s top executives led to a positive response from the cryptocurrency markets. XRP saw a 3.7% increase in value, reaching $0.51, according to CoinGecko.
However, it’s essential to note that the legal battle is not entirely over. The SEC and Ripple are expected to discuss the appropriate remedies for Ripple’s Section 5 violations in connection with its Institutional Sales of XRP. They have requested time until November 9, 2023, to propose a briefing schedule to the court or seek one on a contested basis if an agreement cannot be reached.
This development follows an earlier ruling by New York District Court Judge Analisa Torres, which partially favored both parties. Judge Torres determined that some of the firm’s sales of XRP did not violate securities laws due to a blind bid process in place, while other direct sales of the token to institutional investors were deemed securities. The SEC had attempted to appeal this decision, but their request was denied, leaving the case to proceed without that specific element.
“Today, we are legally vindicated and personally redeemed in our battle against a troubling attempt to abuse the rules in order to advance a political agenda to suffocate crypto in America.”
While this dismissal is undoubtedly a victory for Ripple and its executives, the broader implications for the cryptocurrency industry and regulatory landscape in the United States remain to be seen.