A Manhattan court judge has ordered Labs to pay roughly $125 million in fines to the U.S. Securities and Exchange Commission (SEC) over allegations of misselling the cryptocurrency XRP, according to a court filing.
This amount is significantly lower than the $2 billion in fines and penalties that US regulators had originally sought in the protracted legal battle against the cryptocurrency firm.
The XRP token rose around 20% following the news to $0.6165.
The SEC had sued Ripple, its CEO Brad Garlinghouse and co-founder Chris Larsen in 2020, alleging they had illegally raised more than $1.3 billion through an unregistered securities offering by selling XRP.
However, the regulator dropped its remaining lawsuits against Garlinghouse and Larsen in October. This case has been closely followed as it is one of the most important filed by the SEC within the cryptocurrency sector.
“We respect the court's decision and have clarity to continue growing our company,” Ripple CEO Brad Garlinghouse said in a post on X.
He noted that the court reduced the SEC's claim by about 94%, “recognizing that they had overstepped.” Garlinghouse described the outcome as a “victory for Ripple, the industry, and the rule of law,” adding that “the SEC's headwinds against the entire XRP community have disappeared.”
In her ruling Wednesday, U.S. District Judge Analisa Torres noted that the case did not include any allegations of fraud.
Despite the surge, the XRP token remains relatively unchanged this year. The ruling comes at a time when digital currencies have lost value amid the current risk aversion in the global market.
Judge Torres had previously ruled that XRP was subject to securities law only when sold to institutional investors, a decision celebrated as a significant victory for the industry. The SEC continues to pursue several major cases against cryptocurrency exchanges and issuers, accusing them of offering unregistered securities.
