XRP News Today: Judge Denies Ripple SEC Penalty Reduction Request

In a significant development, U.S. District Judge Analisa Torres denied a joint proposal from Ripple Labs and the Securities and Exchange Commission (SEC) to reduce a $125 million penalty and alter an injunction imposed against Ripple. The decision came less than two weeks after both parties requested the court to lower the civil penalty to $50 million and remove restrictions on Ripple’s ability to sell XRP.

Judge Torres cited a “compelling case” built by the SEC over four years, which alleged that Ripple offered and sold XRP to investors as an unregistered security. While Ripple’s programmatic sales of XRP were not found to be in violation of the law, Torres determined that Ripple’s sales to institutions were, justifying a “substantially reduced” fine.

Torres found the recent arguments from both the SEC and Ripple lacking, stating that while the SEC has the authority to change its course once an enforcement action is initiated, neither party can agree to no longer be bound by a court’s final judgment that a party violated the law.

Ripple’s Chief Legal Officer, Stuart Alderoty, responded on X, formerly Twitter, stating that “the ball is back in our court.” Ripple may choose to continue with its appeal, but Alderoty emphasized that “either way, XRP’s legal status as not a security remains unchanged.”

Judge Torres’ ruling underscores the enduring impact of the SEC’s actions under former Chair Gary Gensler on the crypto industry. Despite efforts by Republican-led initiatives to roll back what critics describe as regulation by enforcement, the lawsuit against Ripple, initiated under then-SEC Chair Jay Clayton, continues to shape the regulatory landscape.

Torres noted that the SEC has dismissed other crypto cases before a court found a violation of federal securities laws, making its case against Ripple relatively distinct. This decision highlights the SEC’s commitment to enforcing securities laws in the crypto space, even as the regulatory environment evolves.

Ripple’s legal battle with the SEC has been ongoing, with the company expressing its willingness to fight the case in the Supreme Court if necessary. However, Torres’ ruling suggests that both parties could potentially end the litigation by withdrawing their appeals.