SEC requests Ripple’s internal documents, details of XRP sales

abdelaziz Fathi

The U.S. Securities and Exchange Commission (SEC) has revived its legal battle against Ripple Labs by filing a motion to compel the company to produce specific financial documents.

In a filing at the U.S. District Court for the Southern District of New York, the SEC sought an order requiring Ripple to hand over financial statements from 2022 to 2023, along with contracts related to ‘Institutional Sales’ post the filing of the complaint.

This request from the SEC is particularly focused on contracts that encompass information about institutional sales of XRP, following a July 2023 ruling. In this ruling, a judge determined that XRP only constituted a security when sold to institutional investors.

The SEC believes that obtaining these documents is crucial for aiding Judge Torres in deciding the appropriate legal remedies, which may include injunctions and civil penalties, if Ripple is found liable for violating Section 5 of the Securities Act of 1933.

The lawsuit against Ripple alleges that the company, along with its CEO Brad Garlinghouse and executive chair Chris Larsen, engaged in raising funds through unregistered securities. In October 2023, the SEC said it plans to drop the case against Garlinghouse and Larsen, but will continue legal proceedings against Ripple.

The trial between Ripple and the SEC is set to start in April. This lawsuit is part of a broader enforcement campaign by the SEC against major U.S. cryptocurrency exchanges, including Coinbase and Binance. Ripple’s chief legal officer, Stuart Alderoty, has criticized the SEC’s aggressive stance towards the crypto industry, labeling the regulator as “out of control.”

Most recently, the SEC failed to overturn a judge’s recent ruling on Ripple’s sales of its XRP cryptocurrency. The same judge who previously ruled in July that Ripple’s sale of a cryptocurrency token to retail consumers wasn’t an unregistered securities offering, determined that the agency had not presented enough evidence of flaws in the original decision.

The SEC still has the option to appeal Judge Torres’ decision, but it can only do so after the case officially concludes, which is expected after a trial on remaining issues scheduled for next April.

Ripple Labs said earlier this week it plans to repurchase $285 million worth of shares from its early investors and employees. This move, described as a tender offer, places the company’s valuation at $11.3 billion.

  • Read this next

    Institutional FX

    Intercontinental Exchange reinvents voice trading with ICE Voice

    “For the first time, ICE’s users will have a single, integrated platform for chat and voice that matches both traders’ need for always-on, instantaneous connectivity with other traders, and firms’ desire for easy-to-access and use records that help them meet their record retention requirements.”

    Fintech

    Duco launches EMIR-compliant transaction reporting eligibility validator

    “With Duco’s transaction reporting eligibility validator, customers can run independent checks whenever they want, get results in minutes, and access a clear audit trail. The solution provides insights at a field-by-field level so clients can see specific issues, discuss, and show ESMA they are considering discrepancies at a deep level.”

    Digital Assets

    Bybit’s trading volume near all-time high ahead of Bitcoin halving

    “Now, we’re seeing large inflows and smart money is moving fast. With the Bitcoin halving just around the corner, Bitcoin is proving itself as an institutional asset, a hedge against economic uncertainty, and a vote for financial freedom.”

    Digital Assets

    Morgan Stanley to add spot bitcoin ETFs

    Morgan Stanley is reportedly considering adding spot bitcoin ETF products to its brokerage platform. This move comes after the Securities and Exchange Commission (SEC) approved the investment vehicle in January.

    Digital Assets

    Hong Kong ends license applications for crypto exchanges

    Hong Kong has officially ceased accepting license applications from cryptocurrency exchanges as of February 29, signaling a stringent regulatory shift.

    Fintech

    Volt secures EMI license, expands payment solutions in UK

    Volt has successfully obtained an Electronic Money Institution (EMI) license from the UK’s Financial Conduct Authority (FCA).

    Retail FX

    ASIC bankrupts finfluencer Tyson Scholz over stock tips

    The Australian Securities and Investments Commission (ASIC) has effectively bankrupted Tyson Robert Scholz, the figure behind “Black Wolf Pit.” The action marks a significant crackdown on so-called ‘finfluencers’ and individuals providing unlicensed financial services.

    Digital Assets

    Green Bitcoin Presale Raises $1M as Bitcoin Approaches its ATH

    The eco-friendly crypto project Green Bitcoin has seen its limited-time presale phase cross $1 million in funding. With an innovative gamified staking model and energy-efficient foundation, Green Bitcoin offers token holders a way to stake their tokens and generate yield.

    Web3

    Introducing QuickNode Streams: Elevating Blockchain Data Management

    Discover QuickNode’s Latest Innovation: Streamlining Blockchain Data Streaming for Enhanced Efficiency and Accessibility. Explore the Future of Blockchain Technology with Streams.

    <