SEC Appeals Ripple Ruling

The Securities and Exchange Commission (SEC) is appealing a judgment from the U.S. Court of Appeals for the Second Circuit concerning Ripple, a web3 payments firm, as stated in a filing on Wednesday.

An SEC spokesperson noted, “We believe that the district court decision in the Ripple matter conflicts with decades of Supreme Court precedent and securities laws and look forward to making our case to the Second Circuit,” according to The Block.

In response to the appeal, Ripple CEO Brad Garlinghouse commented on social media platform X, “Somehow, they still haven’t gotten the message: they lost on everything that matters. Ripple, the crypto industry, and the rule of law have already prevailed. While we’ll fight in court for as long as we need, let’s be clear: XRP’s status as a non-security is the law of the land today — and that does not change even in the face of this misguided — and infuriating — appeal.”

On August 7, a judge ordered Ripple to pay a civil penalty of $125 million, significantly below the SEC’s initial request for $2 billion. The ruling also split the SEC’s initial motion for remedies regarding Ripple’s sale of the token XRP.

Previously, on July 13, 2023, the same judge determined that while Ripple’s programmatic sales of XRP did not violate securities laws, direct sales of XRP to institutional investors constituted securities.

The SEC filed a lawsuit against Ripple in 2020, arguing that Ripple’s sale of XRP violated securities laws, claiming XRP is an unregistered security, and that the firm raised over $1.3 billion through unregistered securities sales.

Updated: Oct. 2 at 22:12 UTC to include commentary from Brad Garlinghouse, context from July 2023 Ripple verdict