After four years of legal battles with the US Securities and Exchange Commission (SEC), Ripple has finally been hit with a $125 million fine by the court. This news caused XRP’s price to surge by 18% within minutes of the announcement, reaching $0.61 at the time of reporting based on CryptoSlate data. District Judge Analisa Torres from the District Court of the Southern District of New York partially granted the SEC’s motion for remedies, which originally sought over $2 billion from Ripple for allegedly selling XRP as an unregistered security.
The court’s decision comes after a partial summary judgment was issued to both parties in July 2023. According to the court filings, it was determined that Ripple’s institutional sales of XRP fell under the category of investment contracts, thus violating securities laws. On the other hand, the court concluded that Ripple’s programmatic sales and other distributions of XRP did not meet the criteria for investment contracts under the Supreme Court’s Howey test, therefore not constituting securities sales. The court specifically highlighted that only 1,278 transactions out of all XRP offerings by Ripple violated Section 5 of the Securities Act of 1933.
Following the court’s ruling, XRP currently holds the 7th rank by market cap with a significant price increase of 19.63% over the past 24 hours. The cryptocurrency boasts a market capitalization of $34.13 billion and a 24-hour trading volume of $2.84 billion. It is important to note that this situation is still unfolding, and more updates are expected to follow as new information surfaces.
As of the latest data at 9:51 pm UTC on Aug. 7, 2024, the total cryptocurrency market is valued at $1.94 trillion with a 24-hour trading volume of $96.91 billion. Bitcoin dominance currently stands at 55.94%, indicating its continued influence in the digital asset space. The regulatory actions taken against Ripple serve as a reminder of the ongoing legal scrutiny that companies in the crypto industry face, highlighting the need for clear guidelines and compliance measures across the board.
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