The U.S. Securities and Exchange Commission (SEC) v. Ripple case just got an exciting update, with the two parties filing a joint motion with a Manhattan federal court to dissolve the existing injunction and release the $125 million civil penalty held in escrow.
Under the proposal, $50 million would go to the SEC, while Ripple would receive the remaining $75 million.
Should Judge Analisa Torres greenlight the proposal, SEC and Ripple will petition the second Circuit Court of Appeals for a limited remand to obtain formal relief.
Following the news, XRP price dropped quickly, trading at $2.14 at the time of writing (down 3.85%). In the meanwhile, the daily trading volume is up 58.47%, suggesting increased market activity generated by the growing legal uncertainties.
Ripple and SEC close to settling
The Ripple v. SEC case is one of the longest legal battles with potentially wide-ranging consequences for the crypto market. Both parties thus appear eager to settle,
By agreeing to a reduced penalty, the SEC stands to expedite fund recovery. For Ripple, on the other hand, dissolving the injunction would remove legal barriers hindering partnerships with institutions such as Bank of America (BofA) and perhaps a potential initial public offering (IPO), as noted last month by James Farrell, a former SEC attorney.
The case also unfolds amid broader shifts in the SEC’s approach to crypto regulation, as the agency has moved toward a safer approach under new chair Paul Atkins.
Accordingly, reduced penalties and a legal rock off its shoulders would allow Ripple to focus on expanding and meeting new regulatory demands.
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