The U.S. Securities and Exchange Commission (SEC) voluntarily dismissed its charges against Ripple executives Christian Larsen and Brad Garlinghouse. This seismic development comes ahead of a scheduled trial in April 2024, leaving the crypto community with questions and speculations. With the SEC retreating on individual charges, what’s next for Ripple? And more importantly, what does this mean for the broader cryptocurrency landscape?
Fred Rispoli, a prominent crypto influencer, put forth a series of nuanced arguments that dig deeper into the implications of this decision. Rispoli questions the motivations behind the SEC’s move, asking whether the dismissal acknowledges the weakness of the SEC’s case against the Ripple execs or reflects a broader erosion of the court’s trust in the regulatory body.
Considering that, while I understand exactly how BG and CL felt while being sued and would want to end it ASAP, it was crystal clear they would win the lawsuit and expose the SEC, so why agree to voluntarily dismiss (even with prejudice) without more? Makes me lean towards…3/4
— Fred Rispoli (@freddyriz) October 19, 2023
- According to Rispoli, there are two possible scenarios: “The former suggests a lengthy, bitter briefing in the remedies stage and an appeal. The latter suggests a final settlement is at hand.” This delineation effectively pits a convoluted legal battle against a smoother, quicker resolution—a settlement.
The Voluntary Dismissal
Rispoli keenly observes that despite the obvious emotional toll on Garlinghouse and Larsen, they were in a strong position to win. “So why agree to dismiss without more voluntarily?” Rispoli asks. The influencer leans towards the probability of an imminent settlement, theorizing that discussions about settlement amounts are probably “flying back and forth between the lawyers as I type.”
The dismissal has led many, including Ripple’s Chief Legal Officer Stuart Alderoty, to call the SEC’s move a “surrender” rather than a settlement. Even Brad Garlinghouse described their years-long battle with the SEC as dealing with “unfounded allegations from a regulator with a political agenda.”
The Ripple Effect: What’s Next?
The dismissal marks a victory for Ripple’s executives but leaves Ripple Labs in regulatory limbo. The SEC still has the option to appeal previous decisions related to XRP’s programmatic sales and other distributions. Rispoli’s insights hint at ongoing backdoor negotiations, likely to result in a settlement—a scenario many in the crypto community are closely watching.