Ripple Vs SEC Case Has Not Been Completed, Regulators Want Crypto Companies To Be Fined

JAKARTA - The legal case between the US Securities and Exchange Commission (SEC) and the XRP crypto asset development company, Ripple, is still ongoing even though the court has issued a summary decision aka the Summary Judgment. Now, both parties are arguing about the documents that Ripple must submit to determine the final verdict.

The SEC, as a capital market regulator in the US, sued Ripple in December 2020 on charges of selling unregistered securities through the sale of XRP worth more than $1.3 billion (approximately IDR 20.5 trillion). The SEC also accused two Ripple executives, namely CEO Brad Garlinghouse and founder Chris Larsen, of helping and becoming partners in violating securities law.

Ripple denies the allegations and claims that XRP is not a security, but a digital asset that serves as a cross-border payment tool. Ripple also accused the SEC of arbitrary and unfair acts against the crypto industry.

In July 2023, Judge Torres of the New York District Court issued a summary assessment that benefits Ripple. Judge Torres ruled that the sale of XRP programmed by Ripple did not meet the legal definition of a securities. This decision is a big win for Ripple, which has spent more than $150 million (approximately IDR 2.4 trillion) to defend itself from its plaintiff, the SEC.

Unfortunately, the decision is not the end of this feud. On the other hand, Judge Torres agreed with the SEC on the sale of XRP for institutional investors who stated that this was part of the sale of unregistered securities. Judge Torres then ordered the trial to resolve the unresolved issues, including allegations against Garlinghouse and Larsen, which were sent down by the SEC in October 2023.

This week, Ripple and the SEC were involved in a new dispute over documents that Ripple had to submit in order for the court to provide injections and civil fines. The SEC asked the judge to order Ripple to release financial reports from 2022 and 2023, as well as contracts relating to institutional sales made after the SEC filed an initial lawsuit.

The SEC also asked Ripple to reveal how much has been obtained from institutional sales since the lawsuit was filed over contracts dated before the lawsuit. The US regulator led by Gary Gensler finds these documents very important to determine whether Ripple committed any new offenses after the lawsuit was filed or not.

Ripple rejected the SEC's request and called the request related to the sale document "irrelevant". Ripple argued that the SEC should have asked for this information during the initial period of the trial regarding this matter. Ripple also wrote in a court letter dated January 19, 2024, that the information sought by the SEC had no effect on determining court solutions.

Responding to the statement, the SEC submitted a court letter dated January 23, 2024. In the letter, the US Regulator showed his attitude and insisted that this matter was far from over.