Ripple SEC Settlement: 500M XRP Unlocked as Remedies Ruling Looms

Ripple has recently unlocked 500 million XRP tokens, valued at approximately $297.74 million.

This substantial release led to an 8% drop in XRP’s price and breached the critical $0.60 support level, as previously highlighted by Coingape.

Settlement Rumours and Legal Opinions

The unlocking has reignited rumours about a potential settlement in Ripple’s ongoing legal battle with the U.S. Securities and Exchange Commission (SEC).

The SEC is seeking a hefty $1 billion penalty from Ripple for alleged violations, while Ripple has proposed a settlement of no more than $10 million.

Pro-XRP attorney Bill Morgan views a settlement as unlikely but acknowledges that if it occurs, it would likely be a compromise rather than a significant victory.

Morgan points out that settlements typically resolve disputes and eliminate appeal rights, though Ripple may face challenges related to XRP sales beyond December 2020.

SEC’s Stance and Potential Appeals

Former SEC lawyer Marc Fagel believes that the SEC’s closed-door meetings are not related to the lawsuit.

He foresees that neither party is likely to settle, with appeals expected from both sides after the ruling. Fagel also suggests that the SEC’s proposed penalty may be overly ambitious, potentially easing Ripple’s path.

Ruling and Political Climate

The timing of the XRP unlock coincides with the anticipated ruling in the remedies phase of the Ripple lawsuit.

Originally expected on July 31, legal experts now predict a decision in August.

Wealth advisor Mickle and others argue that the SEC’s case against Ripple appears weak, considering the firm’s previous legal successes.

Mickle also notes that the shifting political climate, with Democrats moving towards pro-crypto policies, might influence the appeal decisions.

Possible Appeals and Legal Strategies

Morgan anticipates that both parties may appeal if legal considerations alone guide the decision.

He elaborates that Ripple might appeal based on distinctions between institutional sales and sales to On-Demand Liquidity (ODL) customers.

Morgan also highlights the SEC’s rationale for a potential appeal, suggesting that the agency might believe the judge made an error, as evidenced by its request for an interlocutory appeal.