SEC’s Ripple Penalty Demand Sparks Outrage in Crypto Community

The ongoing legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has captured the attention of the crypto community. The SEC’s recent demand for a massive $1.95 billion in fines and penalties has sparked controversy and criticism from supporters of XRP, who view it as an unfair use of regulatory power.

On March 22, the SEC made a bold move by revealing its demand for Ripple Inc. to pay $1.95 billion in fines and penalties. This amount is significantly higher than the alleged gains Ripple made from its unregistered securities offering through XRP institutional sales, which totaled $728.9 million between 2013 and 2020.

The XRP community has raised concerns about the SEC’s aggressive stance, viewing it as a targeted attack on Ripple. Critics argue that the SEC’s demand demonstrates bias, especially when compared to its handling of similar cases involving other companies.

Legal experts, such as Professor J. W. Verret, have highlighted the stark difference between the SEC’s demand and its typical recovery targets. The SEC usually aims for an 11% recovery, making its demand for 300% from Ripple suspicious and suggestive of ulterior motives.

Joining the dissenting voices, Australian-based lawyer Bill Morgan has condemned the SEC’s actions as an abuse of regulatory power. He believes that the SEC holds animosity towards Ripple for vigorously fighting against its plans to control the crypto industry for 3.5 years.

Despite scoring some victories in court, including a ruling that XRP is not a security and the dropping of charges against its executives, Ripple’s battle is far from over. With Ripple set to file its opposition later this month, the fate of the SEC’s demand remains uncertain.

The upcoming decision on the SEC’s demand holds significant implications not only for Ripple but also for the broader crypto world.