XRP News Today: Ripple Clarifies Institutional Sales After Court Ruling

Following the court’s rejection of Ripple and the U.S. Securities and Exchange Commission’s joint motion, there has been significant confusion among XRP holders regarding the implications of the permanent injunction on Ripple’s business with institutional investors in the U.S. Attorney Fred Rispoli provided a precise legal interpretation to clarify the matter.

Rispoli emphasized that the term “Institutional Sales” is not a broad term that applies to all current or future sales involving institutions. Instead, it is a specific legal term defined strictly within the context of Ripple’s past conduct from its inception until 2018. The injunction tied to this term refers only to what Ripple engaged in during that historical period. This clarification counters any misconceptions that the court ruling broadly limits Ripple’s ability to conduct institutional sales going forward. Institutions are expected to play a significant role in XRP’s future, and Rispoli suggests the company can still engage with institutions.

The legal battle between Ripple and the SEC has been ongoing for some time. On August 7, 2024, Judge Annalisa Torres handed down her final ruling, ordering Ripple to pay $125 million as a penalty for violating securities laws through institutional XRP sales. She placed a permanent injunction on the company, preventing further violations of the Securities Act by stopping the institutional sales. Both parties attempted to appeal the ruling but agreed to settle the case in March. The settlement included reducing Ripple’s penalty to $50 million and the removal of the permanent injunction. However, Judge Torres rejected this proposal. This gives both parties the option of dismissing their appeals and leaving the final ruling unchanged or continuing with the appeals to modify the verdict.

Ripple chose to dismiss its appeal, and in his announcement, CEO Brad Garlinghouse revealed that he expects the SEC to do the same. This move has left the community with many questions regarding Ripple’s path forward. Rispoli also notes that under the pro-crypto SEC leadership, Ripple’s transparency in separating lowercase “i” institutional sales from “Institutional Sales” has eased concerns. The SEC is now more comfortable with Ripple, provided it follows established guidance, with or without formal registration statements. Rispoli further explained that Ripple labels the affected transactions as “historical sales,” meaning the injunction targets only past activities. He noted that under the former SEC leadership, future sales might have triggered new legal issues, but this risk has somewhat reduced with the current pro-crypto administration. As Ripple CLO Stuart Alderoty recently stated, the company can now proceed with business as usual.