Ripple Challenges SEC’s $2B Fine with $10M Argument

Ripple, a cross-border payment protocol, has objected to the SEC’s request to impose a $2 billion fine on the company, arguing that the penalty should not exceed $10 million. In their latest filing, Ripple Labs opposed the SEC’s motion to a federal judge, requesting the massive fine, an injunction, disgorgement, and pre-judgment interest. Ripple believes that the court should reject the SEC’s excessive requests and instead issue a more reasonable civil penalty of no more than $10 million. The company stated that it intends to follow regulatory guidelines in the future and has the motivation to do so. They argued that the SEC’s proposed penalties are unwarranted and unsupported by law or principle.

The SEC requested that Ripple pay $876 million in disgorgement, $198 million in pre-judgment interest, and an additional $876 million in civil penalties, totaling nearly $2 billion. Ripple revealed this requested amount a month ago at a hearing. The company’s chief legal officer, Stuart Alderoty, criticized the SEC, stating that they are determined to punish and intimidate both Ripple and the entire cryptocurrency industry. Ripple described the proposed fine as “unreasonable” and argued that a $10 million penalty is more appropriate and aligns with their actual revenues. The exact percentage of revenue they proposed to pay was redacted from the document. Ripple also pointed out that this amount is proportionate to similar digital asset cases without any malicious intent or harm to others.

Alderoty voiced his concerns over the SEC’s actions, stating that they demonstrate the agency’s ongoing intimidation tactics against the cryptocurrency sector in the United States. He stressed that the case has no allegations of fraud or recklessness. He highlighted that Ripple has emerged victorious on significant legal issues and expressed hope that the judge will approach the final remedies phase of the case with fairness and impartiality.