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- Ripple Labs has cited the Terraform Labs settlement as a yardstick to lower its own penalty demand from the SEC.
- Ripple believes its fine should not exceed $10 million against the $2 billion the SEC is requesting.
XRP saw its price plummet following a recent filing involving the ongoing case between Ripple Labs Inc. and the US Securities and Exchange Commission (SEC). According to our data, XRP declined by 3% on Thursday to trade at $0.4773.
Ripple’s Court Filing
Defense lawyer James K. Filan shared details of a recent court filing by Ripple in the SEC lawsuit. Ripple filed a Notice of Supplemental Authority referencing a recent settlement in the SEC vs. Terraform Labs case. This case involved a different crypto project, but Ripple argues it has a bearing on its situation.
The key point of contention is the SEC’s approach to civil penalties. In the Terraform Labs case, the SEC imposed a penalty amounting to roughly 1.27% of the defendant’s gross sales. Ripple, however, points out that the SEC typically seeks penalties within a range of 0.6% to 1.8% in similar cases.
Furthermore, Ripple emphasizes the lack of fraud allegations in its case, unlike Terraform Labs. The firm argues that XRP investors haven’t suffered substantial losses, justifying a more lenient penalty. Ripple is advocating for a $10 million penalty, significantly lower than the SEC’s imposed of $2 billion, as previously reported by Crypto News Flash.
The SEC’s allegations against Ripple focus on the company’s sales of XRP to institutional investors, such as hedge funds, without the appropriate registrations. However, the legal battle between Ripple and the SEC has become a complex web of filings and counter-filings. This latest move by Ripple mirrors a similar tactic used by the SEC earlier this year. In January, the SEC cited the Terraform Labs ruling in their opposition to a motion filed by Coinbase.
In Terraform’s case, the SEC accused the firm of orchestrating unregistered token sales, resulting in over $4 billion in purportedly “ill-gotten gains.” According to a prior report by Crypto News Flash, the SEC has requested a $4.47 billion fine, which the company is still contending with.
This lingering dispute highlights the ongoing struggle between crypto firms and regulators over the classification of digital assets. The SEC continues to push for broader authority over the crypto market, while companies like Ripple are fighting for clearer regulatory frameworks.
XRP Paints Bearish Signal
As of this writing, XRP is trading at $0.4793, down by 1.63% in the past 24 hours. The trading volume also decreased by 17% to $1 billion, while the market cap is standing at $26.6 billion.
Amid the legal disputes, XRP’s price remains below key technical indicators, including the 50-day and 200-day Exponential Moving Averages (EMAs). This reinforces a bearish outlook for the cryptocurrency.
Analysts suggest a break above $0.48 could trigger a price increase, but a drop below $0.4750 might see XRP fall further towards $0.45. The 14-day Relative Strength Index (RSI) reading of 35.57 indicates that XRP could experience a further dip before reaching oversold territory.
