A federal judge of the Southern District of New York has ordered Ripple to pay a $125 million penalty after finding that the blockchain giant violated securities laws. Notably, this fine is way below the $1 billion disgorgement and prejudgment sought by the SEC.
This marks a major milestone in the long-running court case between the two entities. Interestingly, the XRP community saw this as positive news and the price of XRP skyrocketed over 25% following the ruling. It is important to note that Judge Torres previously ruled in 2023 that the programmatic sales of XRP to retail clients do not violate securities laws.
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Ripple to Pay $125 Million in Civil Penalty
District Judge Analisa Torres has ruled that Ripple broke securities laws through 1,278 institutional sales of XRP coins. As a result, the blockchain firm has been ordered to pay a fine of $125,035,150 ($125.035 million). Additionally, Judge Torres banned Ripple from violating federal securities law in the future. She noted that even though she hadn’t said that Ripple broke any laws following the SEC lawsuit, the company might “cross the line.”
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“On balance, the Court finds that there is a reasonable probability of future violations, meriting the issuance of an injunction,” she said.
Following the sentence, the Securities and Exchange Commission is expected to appeal the June 2023 ruling. Recall that Judge Torres denied the SEC’s interlocutory appeal last year. After the interlocutory appeal was rejected, Ripple and the SEC settled accusations against CEO Brad Garlinghouse and other officials.
BREAKING: #Ripple vs SEC: Judge Torres issues Ruling on the SEC’s Motion for Remedies. #Ripple to pay $125 million in penalty. #RippleVsSEC #cryptonewstoday #XRPArmy pic.twitter.com/quKRk6g9lo
— 36crypto – Crypto News (@36Crypto2) August 7, 2024
In July, a U.S. federal court judge denied Ripple Labs’ request for summary judgment in a case alleging that its CEO, Brad Garlinghouse, broke California securities laws, ruling that the business’s civil securities litigation against the company may move forward.
XRP Price Reaction Following Ruling
Meanwhile, the price of XRP has reacted impressively to the latest update. Less than 10 minutes after the ruling, the price of the coin skyrocketed by 23.5% to trade at $0.6307. Before the ruling, the XRP price was consolidating around $0.4 and $0.5 following a global market crash that happened on Monday, August 5.
Source: CoinMarketCap
The new surge has ignited hopes across the XRP community which has been hoping for a rally toward $1. Not surprisingly, XRP’s trading volume has also jumped by an impressive 111%, signifying increasing activities following the ruling. At this time, it is difficult to say how long the uptrend will last, but one thing is sure, the outcome of the Ripple vs SEC lawsuit plays a significant role in the price trajectory of the coin.
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Victor Swaezy
Victor Swaezy is a crypto-journalist with more than 3 years of experience in covering blockchain technology and digital currencies news. Known for his comprehensive reporting, Victor has contributed to leading industry publications, providing market participants with the required knowledge to make informed decisions. When he is not working, he loves to watch movies and have a good time.