Stuart Alderoty, the chief legal officer at fintech firm Ripple, has cleared the air on the forthcoming court proceedings. Contrary to popular belief, Alderoty clarified that there would be no final pretrial conference — an event some believed would result in a settlement between Ripple and the U.S. Securities and Exchange Commission (SEC).
This comes as the top securities regulator seeks a staggering $2 billion fine from Ripple.
Ripple Prepares To Counter SEC’s $2 Billion Demand
Ripple and the Securities and Exchange Commission have been locked in a legal spat since late 2020. But last year, Ripple’s CEO Brad Garlinghouse and Executive Chairman Chris Larsen were cleared in the SEC’s securities-violation charges that had spent years winding their way through U.S. courts.
The Southern District of New York civil and criminal proceedings calendar had initially indicated a settlement conference between Ripple and the SEC on April 16. Ripple’s CLO Stuart Alderoty, however, noted that the final pretrial conference would not be happening because the SEC ended cases against Garlinghouse and Larsen.
Despite voluntarily dropping the charges, uncertainties persist as the SEC recently proposed $1.95 billion in fines and penalties for Ripple. According to the Commission, the colossal fine was appropriate based on Ripple’s “defiance of the law,” continuing to sell XRP to institutional investors despite legal warnings.
Alderoty said Ripple is now preparing to submit its response to the SEC’s proposal for penalties by April 22, and the SEC will file its response by May 6.
XRP Faces Critical Juncture: Is $1 Imminent?
At press time, XRP is trading for $0.4963, representing a $0.5% gain over the past day and a 20.8% decline in the past week. This somber performance reflects the ongoing market volatility and the uncertainties surrounding the Ripple lawsuit.
Victory for Ripple could set a precedent that makes it hard for the SEC to pursue disgorgement in future crypto-related suits and would further boost investor confidence in XRP. In this case, XRP could see increased buying activity and a potential price rally towards the $1 threshold. Contrarily, a win for the SEC would embolden the regulatory to go after more cryptocurrency firms and demand outrageous fines and penalties.
The coming weeks and months promise to be a time of intense legal squabbling as both parties battle for a decisive victory.
