SEC lawsuit against Ripple may end by summer: Ripple CEO
Ripple CEO Brad Garlinghouse expects a judgment in the first half of 2023.
Ripple CEO Brad Garlinghouse has said that his company’s legal conflict with the U.S. Securities and Exchange Commission will likely conclude in the first half of 2023.
On Jan. 18, Garlinghouse spoke to CNBC at the WEF’s Davos conference. He said:
“We’re optimistic that this will certainly be resolved in 2023, and maybe [in] the first half. So we’ll see how it plays out from here. But I feel very good about where we are relative to the law and the facts.”
Garlinghouse added that Ripple would probably not settle with the SEC, explaining that the company would only do so if the SEC determined that XRP is not a security. He noted that the SEC and its chair, Gary Gensler, have clarified that almost all cryptocurrencies are considered a security, leaving “very little space” for a settlement.
Instead, Ripple and the SEC will wait for a decision from the judge. Garlinghouse said that the case has now been fully briefed in the courts. The two parties filed their request for summary judgment late last year, though proceedings were later extended.
In a separate interview with CNBC today, Garlinghouse called the SEC’s behavior “embarrassing” and insisted that the facts of the case and the law both support Ripple.
The SEC filed charges against Ripple in December 2020 as it alleged that sales of XRP constituted an investment contract and unregistered token offering. Ripple immediately pledged to contest the SEC’s charges, and the case gradually progressed.
Numerous companies have come to support Ripple in recent months. Notably, Coinbase suggested that the SEC’s lawsuit caused $15 billion in losses for retail crypto traders.
Most crypto companies targeted by the SEC have chosen to settle immediately, making Ripple is one of just a few crypto firms to fight the regulator. Other attempts to resist the SEC have not been successful: Canadian company Kik lost a battle with the SEC concerning its Kin token in 2020. Telegram similarly lost a battle with the regulator over its ICO in 2020. Video platform LBRY also lost its conflict with the SEC in November 2022.
As such, Ripple’s years-long legal battle is expected to set a precedent for the crypto industry and affect the SEC’s willingness to launch similar suits. Ripple seems to be in a stronger position than some companies in the past, but its victory is not yet certain.