Ripple Decries SEC's "Excessive" Penalty Demands, Proposes $10M Fine

Ripple Labs has challenged the SEC's proposed penalties, rejecting the demand for $1 billion in payments. Ripple contends that the SEC has not proven future violations and proposes a maximum penalty of $10 million, emphasizing its compliance efforts and arguing against an injunction based on speculative future violations.

Ripple Rebuts SEC's Punitive Demands, Proposes Modest $10 Million Penalty

San Francisco, CA - In a defiant response to the Securities and Exchange Commission's (SEC) excessive penalty request, Ripple Labs has vehemently contested the proposed sanctions in its ongoing lawsuit. The blockchain payment provider decried the SEC's demand for over $1 billion in penalties, asserting that such an onerous sum is both unwarranted and unprecedented.

In a comprehensive court filing, Ripple meticulously outlined its rationale for opposing the SEC's exorbitant demands. The company asserted that the SEC has failed to provide compelling evidence to support its allegations of future violations or reckless disregard for the law. Furthermore, Ripple cited the precedent set in the Govil case, arguing that disgorgement should be prohibited due to the SEC's inability to demonstrate pecuniary harm.

Ripple's defense further challenged the SEC's proposed civil penalty, asserting that a maximum penalty of $10 million is more appropriate given the weak legal basis of the agency's case and the relatively modest fines imposed in similar digital asset cases.

"The SEC's excessive penalty demand is a clear example of regulatory overreach," stated Ripple General Counsel Stuart Alderoty. "The company has taken significant steps to rectify any past issues and is committed to compliance. The SEC's pursuit of an exorbitant penalty is unwarranted and out of step with the facts of the case."

Despite the SEC's allegations, Ripple has proactively implemented transformative changes to its XRP sales practices. The company has obtained licenses for XRP sales outside the United States and revised its contracts to address potential concerns.

"Ripple has been a pioneer in the digital asset space, and we remain committed to providing a secure and compliant platform for our customers," said Brad Garlinghouse, Ripple CEO. "We will vigorously defend ourselves against the SEC's baseless claims and continue to work diligently to build a thriving digital economy."

Ripple's response to the SEC's punitive demands underscores the company's unwavering determination to defend its interests and promote innovation in the blockchain industry. The case is closely watched by the broader cryptocurrency community, as it has the potential to shape the regulatory landscape for digital assets.

The SEC is expected to submit its reply brief under seal by May 6th. All involved parties, including third parties, have until May 20th to submit letter motions and opposition related to the sealing of specific details in the filings. The outcome of the case remains uncertain, but Ripple's spirited defense has injected new momentum into the protracted legal battle.