The SEC’s proposed settlement offer was made available to Ripple’s Chief Legal Officer, Stuart Alderoty, before the agency filed a lawsuit against the company in December 2020. According to Alderoty, the SEC’s settlement proposal called for XRP to be recognised as a security in the public eye and for a transition period to allow for market compliance.
Remaining true to its position that XRP shouldn’t be categorised as a security, Ripple rejected the SEC’s request. Additionally, the business questioned the SEC’s absence of an appropriate regulatory framework for cryptocurrency compliance. The SEC accused Bradley Garlinghouse, the CEO of Ripple, and co-founder Christian Larsen of conducting an unregistered digital asset security offering with the intention of raising $1.3 billion in a proceeding that began on December 22, 2020.
Alderoty stressed that the SEC had opted to move forward with an enforcement-oriented strategy, even though the agency had three years to create clear guidelines for crypto compliance following the case. Legal measures have been taken as a result against well-known cryptocurrency exchanges, such as Binance and Coinbase.
The SEC has not made much progress in creating a particular regulatory framework for the crypto industry, despite the claims of US crypto enterprises that current securities regulations are inappropriate for crypto assets. But in July 2023, Judge Analisa Torres issued a summary judgement in which she declared that XRP is not a security when it comes to retail transactions. In addition, Cointelegraph revealed in October that the SEC has dropped its accusations against Larsen and Garlinghouse.
