Ripple’s chief legal officer has addressed the possibility of an appeal by the U.S. Securities and Exchange Commission (SEC) following the $125 million final judgment in the XRP case. He suggested that if the Biden-Harris administration is committed to resetting its stance on crypto, the securities regulator should not seek to appeal. He noted that the SEC “lost on everything” important, highlighting that the court firmly rejected the notion that XRP itself could be classified as a security.
Ripple Legal Chief on Potential SEC Appeal of Final Judgment in XRP Case
Ripple’s chief legal officer, Stuart Alderoty, discussed the outcome of the case brought against Ripple by the U.S. Securities and Exchange Commission (SEC) over XRP in an interview with CBNB last week. This followed the final judgment in which District Judge Analisa Torres partially granted the SEC’s motion for remedies against Ripple, imposing a $125 million civil penalty.
“We’re feeling really good about it,” Alderoty said of the judgment. “Ripple, when it was first sued by the SEC almost four years ago, said that we were going to defend this case, not only on our own behalf but on behalf of the entire crypto industry. This administration, with this SEC, under this chair, has clearly taken an anti-crypto stance and has engaged in a war on crypto that’s playing out in the courts.”
Alderoty added:
I think they [SEC] lost on everything that was important to them. Trying to establish that a token itself — in this case, XRP — can be considered a security was soundly rejected by the court.
The Ripple legal chief further clarified: “What the court said is that a token is never a security in and of itself, just like a bar of gold is never a security. You can certainly package commodities or virtual currencies and sell them as securities, but they’re not securities in themselves, and that’s the core clarity that we sought in this case — establishing that XRP is not in and of itself a security is now the law of the land.” He further explained: “What the judge did find is that certain historical sales, beginning around 2015, the way that those sales were packaged with sophisticated third parties, should have been registered under the securities laws. And that’s the piece of the decision that we respect.”
Regarding the $125 million fine, Alderoty said: “That’s something that we will pay with cash off our balance sheet and look forward to moving forward.” He hopes that this marks a new chapter for Ripple and signals a fresh start for the Biden-Harris administration to “turn the page on their war on crypto and hit the reset button.”
Commenting on whether the legal battle with the SEC is over, the Ripple chief legal officer opined: “In our minds, we are finally done.” He noted: “The fine, pursuant to the court’s order, needs to be paid in 30 days, and we will do that.”
Alderoty also shared his view on whether the SEC will appeal the court order. “The SEC certainly has the option to pursue an appeal,” he stated, noting: “I think they’ve got 60 days to make that determination.” However, he stressed: “We’re focused on the finality that this order gives Ripple. We want to focus on continuing to grow our business both globally and domestically. We like the clarity that this lawsuit and the outcome of this lawsuit have provided us, and that’s where we’re going to be focusing on.”
When asked whether the SEC will appeal the decision, Alderoty replied:
If the SEC is a rational actor … and if this administration truly is serious about hitting the reset button on their war on crypto, there should be no appeal, and everyone should be moving on.
He concluded: “This war on crypto has really skewed the SEC’s core mission and skewed their commitment to kinda stick to their lanes in their jurisdiction. What we need as a country is to hit the reset button, and what we really should be focusing on is creating clear laws, rules, and regulations so this industry can thrive in the United States just as it is thriving outside the United States.”