Ripple Fined $125 Million for XRP Sales: CEO Reacts to Legal Victory

U.S. federal judge Annalisa Torres ordered Ripple Labs to pay a $125 million fine for selling XRP tokens without proper registration. Despite the hefty fine, the financial burden faced by Ripple is far less than the $2 billion originally requested by the U.S. Securities and Exchange Commission (SEC).

The decision ends a long-running battle with the SEC that has captured the attention of the cryptocurrency industry.

Ruling Brings Clarity to Industry

The case began in 2020 when the SEC accused Ripple of raising funds through the sale of unregistered XRP, claiming that the digital tokens were securities. The U.S. Securities and Exchange Commission subsequently filed a lawsuit against Ripple in December 2020, creating significant legal challenges for Ripple.

However, Judge Torres’s ruling on August 7 stated that Ripple’s actions had nothing to do with fraud, impacting the final fine. The ruling also prohibits Ripple from further violating securities laws and ensures future compliance.

Ripple CEO and CLO’s Reactions

Ripple CEO Brad Garlinghouse lowered the SEC’s request by about 94% to respect the court’s ruling and expressed relief that Ripple can now continue to grow its business.

“This ruling is a victory for Ripple, the industry, and the rule of law. The SEC’s strong opposition to the entire XRP community is now gone,” Garlinghouse said.

Ripple Chief Legal Officer Stuart Alderotti commented on the court’s decision, noting, “We respect the court’s imposition of a $125 million fine for certain past sales to complex third parties.”

Market Reaction and Future Outlook

Ripple’s price surged following the court ruling, seeing a 27% increase within 1 hour and 30 minutes. As of now, XRP is trading at $0.6171, showing stability post-ruling.

Overall, the ruling brings clarity to the regulatory stance on digital tokens and paves the way for Ripple to move forward with its business operations.