Ripple execs reject the SEC’s decision to appeal the XRP ruling

The Securities and Exchange Commission (SEC) has announced its decision to appeal the federal court ruling in its long-running legal battle against Ripple Labs and XRP.

The SEC’s appeal, filed with the Second Circuit Court of Appeals on Oct. 2, follows a landmark August ruling that yielded a mixed result in the regulator’s high-profile case against Ripple.

Ripple CEO Brad Garlinghouse and CLO Stuart Alderoty expressed their disappointment with the regulator’s decision to appeal and reaffirmed their intention to fight the case in court.

SEC appeal

The SEC, which sued Ripple in December 2020 over allegations that the company made a $1.3 billion unregistered securities offering through XRP sales, claims the court’s decision violates long-standing precedent of the Supreme Court.

Ripple had initially celebrated parts of the ruling as a victory for the crypto industry. U.S. District Judge Analisa Torres ruled that programmatic sales of XRP to retail investors through crypto exchanges did not violate securities laws.

However, the judge also ruled that Ripple’s direct sales of XRP to institutional investors – worth $728 million – constituted unregistered securities sales, resulting in a $125 million fine for the company.

The SEC had originally sought a significantly higher fine of $2 billion, but the lower-than-expected fine was seen as a victory for Ripple. Nevertheless, the unresolved status of the case is now coming back to the fore with the SEC’s appeal.

News of the SEC’s move caused XRP to fall further in value, dropping around 9% over the past day to trade just above $0.54 at the time of writing, based on data from CryptoSlate.

Ripple execs slam SEC

Garlinghouse said he was “frustrated” by the agency’s ongoing legal battle and accused it of wasting taxpayer money on a case that had already been decided in Ripple’s favor on key issues. He argued that the SEC had lost “everything that matters” under Chairman Gary Gensler and reiterated that XRP’s non-security status remains the law, regardless of the agency’s appeal.

Garlinghouse further criticized the SEC for its lack of accountability, noting that the agency faces no consequences for continuing what he considers a losing battle. He emphasized that Ripple, the crypto industry and the rule of law have already prevailed, and this call would not change that.

Meanwhile, Alderoty echoed the sentiment, reiterating that the court found there were no “casualties or losses” in the case. He stated:

“Instead of faithfully applying the law, this agency, under this chairman, continues to pursue lawsuits against the industry. We are investigating whether we can file a cross-appeal.”

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