Fox Business Journalist Eleanor Terrett reports that the long-running legal battle between the US Securities and Exchange Commission (SEC) and Ripple Labs may soon come to an end, though ongoing negotiations over settlement terms are causing delays.
According to Terrett, the company’s legal team is exerting force for more favorable terms regarding the August 2023 district court ruling, which imposed a $125 million fine on the company and barred the company from selling XRP to institutional investors.
Ripple’s Stance” Shifting SEC Enforcement
Ripple’s argument setms from the SEC’s apparent shift in enforcement strategy under its new leadership. The company contends that if the SEC is reconsidering its regulatory approach toward crypto firms, it should not hold the company to penalties based on outdated enforcement policies.
Accepting the current ruling would require the company to admit wrongdoing, a stance Ripple is reluctant to take given the SEC’s own uncertainty about whether any violations occurred.
Background: The Torres Ruling and Its Implications
The case has been a focal point in crypto regulation debates, with Judge Analisa Torres’ ruling in July 2023 marking a key moment. She found that while institutional XRP sales violated securities laws, secondary market transactions did not constitute investment contracts.
This decision challenged the SEC’s broader claims about cryptocurrency regulation and set a standard for other digital assets.
Negotiation Hurdles
The company’s legal team is reportedly leveraging this context to negotiate reduced penalties and clearer path forward. However, the lack of precedent for such cases has slowed progress, with both sides navigating unexplored legal territory.
As the negotiations continue, the outcome of this case could have a significant implications for the crypto industry. Observers are closely watching whether Ripple can secure a more favorable resolution or if the SEC will maintain its stance.
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