- SEC’s reply brief in the Ripple opposition is due by Next Monday, May 6.
- The reply brief concerns the $2 billion penalty the SEC proposed in March against Ripple.
- Market pundits speculate that the SEC will likely persist in pursuing punitive disgorgement.
The XRP community anticipates that the U.S. SEC will submit a reply brief by May 6 in response to Ripple’s opposition to the regulator’s request for approximately $2 billion in penalties from Ripple.
For context, in the July 2023 victory judgment, the court also ruled that Ripple violated federal securities laws by selling XRP to institutions. Accordingly, the SEC has requested a civil penalty of $876.3 million, an additional $876.3 million in disgorgement, and prejudgment interest totaling $198.15 million, bringing the total proposed fines against Ripple to $1.95 billion.
Furthermore, when the SEC filed its opening brief on March 22, advocating for an almost $2 billion penalty, it also accused Ripple of persisting in XRP sales to institutional investors post-complaint. As a result, the SEC urged the court to prohibit XRP sales to institutional investors.
However, in its opposition brief last week, Ripple presented compelling legal arguments opposing the SEC’s claims. Ripple contended that the XRP sales conducted after the complaint were to accredited investors and were facilitated through ODL transactions. These sales are exempt from U.S. securities laws, as they were carried out by Ripple’s Singapore branch, which is regulated by Singapore’s central bank.
Additionally, Ripple’s president, Monica Long, testified that even these ODL transactions resumed after the July 2023 judgment because Ripple had ceased XRP sales since the SEC filed the charges.
Now, the SEC is expected to file its comment on Ripple’s opposition by Monday, May 6. Market pundits speculate that the SEC will likely persist in its pursuit of punitive disgorgement and injunction, restricting Ripple from engaging in further XRP institutional sales.
Besides, on Monday, April 29, the SEC filed its opposition to Ripple’s motion to strike the SEC’s new expert materials. These filings are projected to be the final submission before Judge Analisa Torres decides on the penalty for selling XRP to institutional investors.
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