SEC rejects compromise proposal Ripple

On June 13, Ripple Labs again asked US District Judge Analisa Torres for a more lenient sentence of "no more than $10 million" in the XRP lawsuit. The company was referring to the SEC's recent settlement with Terraform Labs.

This would be significantly less than the civil penalty of USD 876.3 million originally proposed by the U.S. Securities and Exchange Commission. The SEC is now reacting to Ripple's approach and showing its stubbornness.

Ripple is comparing apples to oranges because the settlement with Terraform Labs, including a $420 million civil penalty, would only have come about because of the special circumstances, the SEC explains.

Unlike Ripple, Terraform Labs was bankrupt, had agreed to pay money back to investors and had also fired the executives "responsible at the time of the violations."

In July 2023, Ripple won a partial victory in the legal dispute, as Judge Torres ruled that XRP was not a security in connection with transactions by retail investors. However, when sold to institutional investors, XRP should be considered a security.

XRP is currently trading at USD 0.49, which is significantly lower than it was in the summer of 2023.

In total, the SEC's proposed penalties for Ripple total nearly USD 2 billion, including USD 198.2 million in advance interest and another USD 876.3 million in refunds.

The Ripple Labs company could be successful in the long run anyway, even without adoption of XRP.