Ripple SEC: Victory Stands Despite Settlement Rejection

For many in the cryptocurrency space, the legal battle between Ripple and the SEC has been a focal point. A recent development saw a US court reject a proposed settlement motion between the two parties, causing some confusion. However, Ripple maintains this procedural step does not diminish its significant legal victory regarding XRP.

Ripple Legal Victory Confirmed by Chief Legal Officer

Stuart Alderoty, Ripple’s chief legal officer, quickly addressed the situation following the court’s decision on May 15. He stated unequivocally that the rejection of the joint motion seeking an indicative ruling on their proposed settlement does not overturn or threaten Ripple’s win in the case. This victory, announced back on March 19, established that programmatic sales of XRP do not constitute investment contracts.

Alderoty emphasized that the court’s decision was related to procedural issues concerning the dismissal of Ripple’s cross-appeal, not the substance of the prior ruling on XRP’s security status. He reiterated that the core finding – that XRP is not a security – remains unchanged.

Why the SEC Settlement Motion Was Denied

According to the court document filed by Judge Analisa Torres, the joint motion was deemed “procedurally improper.” The judge noted that by styling their request as a motion for ‘settlement approval,’ the parties failed to address the necessary legal burden required to vacate a prior injunction and substantially reduce the proposed civil penalty. The court highlighted that the motion did not mention the specific rule (likely related to vacating judgments or modifying injunctions) that would govern such a request.

Previously, the SEC and Ripple had reportedly agreed to lower the initial $125 million fine. Alderoty had disclosed that the SEC would keep $50 million of this amount as part of the proposed resolution. However, the court found that the procedural filing did not adequately address the legal requirements for modifying the existing court orders based on this settlement agreement.

Community Seeks Clarity on XRP Lawsuit Details

Despite Alderoty’s assurances that the SEC and Ripple are in agreement to resolve the case, the lack of specific details regarding the procedural concerns has left parts of the XRP community wanting more information. Some observers noted the apparent contradiction between previous statements that the case was ‘over’ and this new procedural step.

Members of the community took to social media to ask for a clearer explanation of what went wrong with the filing. This sentiment reflects a desire for full transparency in the final stages of this long-running legal battle. Meanwhile, the broader crypto community continues to watch the Ripple SEC case closely for its potential implications on cryptocurrency regulation.

This development also briefly intersected with unrelated online reports suggesting political manipulation regarding a potential national cryptocurrency reserve, which drew criticism towards Ripple from some corners of the Bitcoin community who advocate for a Bitcoin-only reserve strategy.

In summary, while a procedural hurdle arose with the settlement motion, Ripple’s chief legal officer asserts that the fundamental legal victory defining XRP’s status remains intact, pending the final resolution of the case details.