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Amid all this, the price of XRP has continued to decline, losing more than 10% in the last eight days.
Ripple Labs cites the settlement between the Security Exchange Commission (SEC) and Terraform Labs to argue for a lower penalty against itself.
The SEC had initially asked for a $1.95 billion settlement as a penalty from Ripple for the alleged sale of unregistered securities. However, the company is fighting against the proposed fine, stating that it is unreasonable and should be lowered to just $10 million.
Ripple Highlights SEC’s Disparate Approach Compared to Terraform Labs Case
In a filing released yesterday, tagged “Terra Form Notice of Supplemental Authority”, the defendant’s lawyer cited the $4.47 billion settlement with Terraform Labs as a similar case. They argued that the penalties given to Ripple are higher than the offense committed, noting that the regulatory body has agreed to civil penalties for similar offenses, and punishments given range from 0.6% to 1.8% of the defendant’s gross revenues. The blockchain company’s proposed $10 million fine falls within that category.
Ripple further emphasized that, unlike Terraform, it was not charged with any fraud case; instead, it was accused of distributing unregistered securities, yet the financial watchdog is imposing a heavier punishment. The defendant’s lawyer stated:
“As Ripple’s opposition explained, in incomparable (and even more egregious) cases, the SEC has agreed to civil penalties ranging from 0.6% to 1.8% of the defendant’s gross revenues.SeeECF No. 955 at 29-30. Terraform fits that pattern. Here, by contrast, the SEC seeks a civil penalty far exceeding that range, even though there are no allegations of fraud in this case, and Institutional Buyers did not suffer substantial losses.”
Echoing this were also the words of Bill Morgan, an XRP lawyer, who revealed on his X page that the attitude of the SEC towards Ripple is ill-motivated. He mentioned that the commission accepted a judgment for a penalty amounting to only 1.27% of Terra’s gross sales, even after a jury verdict found Terraform guilty of “one of the largest securities frauds in US history.” However, in the case of Ripple, where no fraud case was mentioned, the regulator is imposing a fine of $876 million. Morgan said:
“Against Ripple in a case in which there was no allegations of fraud and institutional buyers suffered no losses, the SEC seeks a penalty of $876 million, which Ripple alleged was 20 times more than any other penalty in crypto-related cases at that time.”
XRP Price Keeps Struggling amid Ripple-SEC Issues
Amid all this, the price of XRP has continued to decline, losing more than 10% in the last eight days. It has been trading within a range of $0.45 and $0.55 since mid-April. This is not in correlation with the price of Bitcoin, Ethereum, and many other major altcoins; although they have also experienced declines in the past few days, they have seen their prices rise in recent times.
XRP has also been one of the most underperforming top cryptos, not typically following the bullish moves of others but always quick to decline further when they do. The whole legal issue is no doubt affecting the coin’s market sentiment.
