Ripple’s CLO Exposes SEC’s Hypocrisy: Took A Jab on SEC’s Pre-Settlement Offer 3 Years Ago

The post Ripple’s CLO Exposes SEC’s Hypocrisy: Took A Jab on SEC’s Pre-Settlement Offer 3 Years Ago appeared first on Coinpedia Fintech News

The ongoing legal feud between Ripple and the SEC has taken a fresh twist. Ripple’s Chief Legal Officer, Stuart Alderoty, openly criticized SEC officials, including Gary Gensler, for his corrupt proposal three years ago. This revelation surfaced during a recent statement by Alderoty on the X platform. 

Story Behind “Short Window” Offer by SEC to Ripple

Since settlement with the SEC was never the choice for Ripple, they decided to fight back this epic legal battle to emerge victorious. Alderoty disclosed that before the official lawsuit was filed against Ripple, the SEC proposed a settlement offer that required acknowledging XRP as a security. Moreover, the offer included a brief window for market compliance with existing securities laws. Ripple staunchly rejected this offer, citing its confidence that XRP wasn’t secure and highlighting the lack of clear crypto rules. 

Judge’s Felt the Hypocracy!

After three years of rigorous fight with the SEC, Ripple received some favorable court rulings earlier this year, notably a summary judgment on July 13 affirming that XRP isn’t a security. Alderoty emphasized that proving XRP’s non-security status was always the primary objective.

Additionally, Alderoty underscored Ripple’s resilience in fighting the lawsuit, stating that despite skepticism, the company emerged victorious. He also pointed out how the SEC’s inconsistent arguments were exposed during the legal proceedings, notably highlighted by Magistrate Sarah Netburn’s critique of the SEC’s opportunistic stance to serve its goals rather than faithfully uphold the law.

And the Battle Continues…

The final judgment is pending as the case moves into the remedies phase to determine Ripple’s penalty for alleged law violations. Following this, the SEC will decide whether to challenge the judgment at the Second Circuit or consider a settlement with Ripple, which remains uncertain. While Ripple’s case is unique and was a well-played legal battle, others may struggle to overcome the regulatory hurdles.

Since the SEC is in no mood to bring new rules, they believe Howey and will rely on the Supreme Court’s decision to tackle the security complexities. On a clear note, the SEC said that if a crypto asset is offered and sold as a security, it must undergo the disclosure process established by Congress.