Ripple Ordered to Produce Crypto Sale Info for SEC

2 views 7:49 am 0 Comments February 7, 2024

Blockchain company Ripple has been ordered to share financial statements about cryptocurrency sales with regulators.

That ruling came from a New York judge, and requires Ripple to share statements and information about the sale of XRP tokens with the U.S. Securities and Exchange Commission (SEC), Coindesk reported Tuesday (Feb. 6), citing court documents.

The SEC requested that information last month, in the wake of a crucial ruling in a lawsuit against Ripple. Filed in 2020, the suit accuses the company of conducting a $1.3 billion unregistered securities offering tied to its XRP token.

The ruling last year by Judge Analisa Torres found that only Ripple’s institutional — and not retail — sales of XRP violated the law, which was seen by the crypto sector as a victory.

As PYMNTS wrote at the time, it’s a ruling that has “far-ranging repercussions across the digital asset ecosystem, which has long argued that its tokens do not represent securities contracts.”

However, the Coindesk report notes that the court had found Ripple liable for violations before the suit was filed in 2020. The SEC argues these documents will help Torres decide whether the court should issue injunctions or civil penalties for the time since then.

The order requires Ripple to share financial statements for 2022 and 2023 as well with contracts for institutional sales since the lawsuit was filed.

Ripple had opposed the SEC request last month, calling it untimely and arguing the commission had “failed to justify each of its requests on the merits.”

“The SEC’s request for irrelevant and burdensome post-complaint discovery, especially given the close of fact discovery, should be denied,” attorneys for the company said.

Ripple won another court victory last year when the SEC said it was dismissing its claims that Ripple CEO Brad Garlinghouse and Executive Chairman Chris Larsen aided and abetted the firm’s alleged securities law violations.

Meanwhile, the company announced recently that it’s planning to expand its payments business in the United States.

For now, 90% of Ripple’s business is based overseas, Ripple Senior Director and Head of Product Marketing W. Oliver Segovia, said last week, though that could soon change.

“After being relatively quiet for the past 3 years in the US for Ripple Payments, we’re geared up to announce new product updates powered by our money transmitter licenses (MTLs) that cover the majority of US states,” Segovia wrote on LinkedIn.