SEC Targets Ripple with $2 Billion Fine, Legal Battle Heats Up

On Monday, Ripple's top legal executive, Stuart Alderoty, disclosed that the Securities and Exchange Commission (SEC) is pursuing a massive $2 billion in fines and penalties against Ripple Labs. This hefty sum was mentioned before the legal documents are scheduled to be unveiled on Tuesday, March 25.

Alderoty announced on X (formerly Twitter) Ripple's intention to contest the SEC's claims in the upcoming month.

Alderoty criticized the SEC for its allegedly misleading tactics, accusing the agency of trying to intimidate Ripple and the wider sector.

Echoing Alderoty's sentiments, Ripple CEO Brad Garlinghouse highlighted on X that the SEC's $2 billion demand is notably excessive, given that there were no accusations of fraud or negligence involved in the case.

Furthermore, Garlinghouse accused the SEC of overstepping its boundaries, mentioning the DEBT Box case where Judge Robert Shelby criticized the SEC for misconduct.

In response to inquiries, an SEC spokesperson opted not to comment on the matter, with the court filings set to become public on Tuesday.

The legal tussle between the SEC and Ripple has been ongoing, focusing on whether Ripple’s sales of the XRP token should be classified as unregistered securities transactions.

A notable ruling last year found that while Ripple's direct sales of XRP did not violate securities registration requirements, its institutional sales might have.

This ruling was a setback for the SEC, which had argued that Ripple knowingly violated securities laws.

This ongoing legal saga underscores the complex regulatory environment surrounding cryptocurrencies and the challenges faced by regulators and industry participants alike.

Ripple's upcoming response to the SEC's allegations is highly anticipated, as it will provide further insight into this protracted legal battle.