The US Securities and Exchange Commission (SEC) has dropped its aiding and abetting allegations against Ripple’s top managers.
In a letter to Judge Analisa Torres, the SEC informed the court that it is dropping its charges against Ripple CEO Brad Garlinghouse and co-founder Chris Larsen.
The allegations were related to the SEC’s original 2020 lawsuit alleging that Ripple issued XRP, the native asset of the XRP Ledger, as an unregistered security. In July, the courts ruled that the company’s programmable sales of the asset were not securities transactions.
In a new press release from Ripple, the company calls the SEC’s move an “astonishing capitulation” by the US government.
Says Garlinghouse,
“For nearly three years, Chris and I have been the subject of unsubstantiated allegations of a fraudulent regulator with a political agenda… Instead of looking for the criminals stealing customer funds on offshore exchanges currying political favor, the SEC has gone after the good guys.” – along with our entire company of innovators and entrepreneurs – building a regulated, US-based company. We look forward to the day when this chapter is closed once and for all, now that the SEC is bringing down the curtain on its absurd theatrics against Chris and me.”
Ripple says that due to the regulatory confusion created by the SEC in its “misguided pursuit of power,” crypto innovation is being driven out of the US and 90% of the company’s business is now based outside the US.
Meanwhile, Larsen says the SEC’s decision to drop charges against the executives helped justify them legally against the regulator’s political agenda to “stifle crypto in America.”
“It is a tragedy that we were forced to defend ourselves against an ill-advised attack that was flawed from day one. Although justice ultimately prevailed, the government’s actions leading to this point raise questions about the origins and motivation of this lawsuit. It is an abuse of the administrative state that politically connected special interests with clear and proven conflicts of interest were able to drag our names into the mud to ruin us personally and destroy an enterprise that so many have worked so hard to build for so long.”
XRP rose 7% following the news and is trading at $0.52 at the time of writing.
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