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SEC case against top Ripple executives dropped

By:
on Oct 20, 2023
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  • Another SEC blow as charges against top Ripple executives dropped
  • It's the SEC's third loss in the court battle with Ripple.
  • XRP price rose more than 8% after the news, with the broader market also buoyed by positive Bitcoin ETF news.

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The US Securities and Exchange Commission (SEC) has dropped charges in its case against Ripple CEO Brad Garlinghouse and Executive Chairman Chris Larsen.

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SEC’s vote to dismiss the case against the two Ripple executives was announced late Thursday, with an agreement by both parties meaning the trial that was expected in April 2024 will not now happen. Pro-crypto legal experts say this is a regulatory victory for Ripple and crypto.

Garlinghouse said in a statement:

“For nearly three years, Chris and I have been the subject of baseless allegations from a rogue regulator with a political agenda. Instead of looking for the criminals stealing customer funds on offshore exchanges that were courting political favor, the SEC went after the good guys.”

He added that the company now looks forward to when the whole case that was initially filed in December 2020 is closed.

The latest development in the Ripple vs. SEC case is the third time the regulator has lost the court battle to the crypto company.

In July this year, the SEC suffered a blow when the court ruled that XRP, the native cryptocurrency of the Ripple blockchain ecosystem, is not a security. That was then followed by another loss when the SEC’s effort to appeal the July ruling failed. The regulator’s move to dismiss “with prejudice” all claims against Garlinghouse and Larsen adds to the mounting incidents of massive losses.

Larsen commented:

“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. It is a travesty that we were forced to defend ourselves from an ill-advised attack that was flawed from the day it was filed.”

When next in the Ripple vs. SEC case?

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While the case against the top Ripple executives, which had a trial scheduled for April next year, is now closed, more litigation is still likely given the SEC’s allegations against the company. In particular, will be developments around the SEC’s claims against Ripple‘s XRP institutional sales. The battle here is expected to be on the size of the penalty SEC will seek.

Another step could be the SEC’s appeal of Judge Analisa Torres’s July ruling on XRP. While the judge denied the regulator’s interlocutory appeal request earlier this month, the decision was that this could be allowed after the trial. With no trial now, it remains to be seen if the SEC will pursue an appeal after the case’s penalty phase closes.

Ripple’s latest victory against SEC has seen another spike in crypto prices, with XRP jumping more than 8% to above $0.52. A broader positive sentiment around Bitcoin ETF also helped BTC spike towards $30k again, with altcoins also seeing decent gains.

USA XRP Altcoins Crypto Crypto regulation Political