XRP Price Surges 6% as Ripple and the SEC Settle Their Long-Running Legal Dispute

The long-running legal dispute between Ripple and the Securities and Exchange Commission (SEC) is finally over. The regulator confirmed yesterday (Thursday)

The cryptocurrency regulator, the Securities and Exchange Commission (SEC), has confirmed that the regulator and Ripple have reached a settlement agreement.

The regulator said yesterday (Thursday) that both parties have agreed to a $50 million penalty to be paid by the blockchain company. This follows a long-running legal dispute, which began in December 2020.

The latest settlement amount is a portion of the $125 million initial penalty imposed on Ripple last year by Judge Analisa Torres of the Southern District of New York (SDNY). At that time, the SEC requested a $2 billion penalty against Ripple.

The regulator alleged that Ripple raised over $1.3 billion by selling XRP tokens in an unregistered securities offering, violating federal securities laws.

However, the Judge found that Ripple's direct sales of XRP to institutional clients violated federal securities laws, but the programmatic sales of XRP to retail clients through exchanges did not constitute a violation.

After the earlier court order, both parties appealed: Ripple asked for the penalty to be dismissed, while the SEC sought a higher amount.

The regulator also noted that it would return over $75 million currently being held in escrow to Ripple.

“This settlement, alongside the programmatic disassembly of the SEC’s crypto enforcement programme, does a tremendous disservice to the investing public and undermines the court’s role in interpreting our securities laws,” noted SEC Commissioner Caroline Crenshaw in the official announcement.

The settlement comes weeks after Paul Atkins took over as the SEC Chair. Atkins is viewed as a crypto-friendly individual, unlike his predecessor, Gary Gensler.

However, Garlinghouse confirmed the end of the SEC battle in mid-March. This suggests that the settlement was confirmed when Mark Uyeda headed the regulatory agency in an acting capacity. Uyeda also dropped multiple other high-profile crypto lawsuits and investigations.