SEC’s Charge on Ripple.
Ripple is a real time gross settlement system currency exchange and remittance network created by Ripple Labs INC, a US Based Technology Company. For the past some time, Ripple has been under serious scrutiny by SEC. SEC also went on to file a charge against Ripple and in response to the charge, Ripple filed a case back at the SEC.
On December 22nd 2022, the Securities Exchange Commission, which is the official regulatory body for cryptocurrency market, went on to charge the cryptocurrency firm for following some kind of malpractices.
Basically, SEC went on to file case against, Ripple Labs Inc, and two of its executives who also are the share holders of the company. The charge was that, both of the executives had raised around $1.3 Billion through unregistered, ongoing digital asset securities holding.
Almost two years has gone by and the issue has not yet been resolved. It is believed that Ripple has invested a lot of its financial power and is tipped to invest around $100 million on the legal fees by the end of the case.
100 million Dollars as Legal Fee to fight SEC, says the CEO!
The CEO of Ripple Brad Garlinghouse commented that the company has already invested a lot and by the end of the case, the legal fee would cost around $100 Million.
He says, SEC generally follows the routine of making the companies succumb to the pressures and agree to settlement. He also added that, SEC also thinks that most of the cryptocurrency exchanges don’t have enough financial strength to withstand a lawsuit and surely see this as an opportunity to make the companies agree for settlements.
In contrast, he says that Ripple is not like other cryptocurrency exchanges. Ripple is going to fight till the end of the lawsuit to win the case, he claimed.
The possible outcomes of the lawsuit!
If the verdict comes in favor of Ripple, then SEC would be put under scrutiny and a lot of pressure to make more transparent guidelines in the favor of cryptocurrency firms and institutions. If at all the verdict comes in the favor of SEC, then will have the say in terms of settlement and would also list the case as an example compelling other businesses to seek for settlement and not participate in lawsuit and court proceedings.
From the outside it looks as though the crypto currency company has enough funds to fight the court case and hence has filed the court case against SEC. But on the other hand, SEC also doesn’t look to be backing off in the court situation. Only the court will be deciding the future of both the parties as to how they will be functioning and operating.