- Ripple’s Stuart Alderoty criticized the SEC, comparing record fines to systemic failure in regulatory oversight.
- SEC announced $8.2B in financial remedies from 583 enforcement actions in fiscal year 2024, the highest ever.
- Ripple and Archax launched the first tokenized money market fund on the XRP Ledger, advancing blockchain-based DeFi solutions.
Ripple’s Chief Legal Officer, Stuart Alderoty, has voiced sharp criticism of the U.S. Securities and Exchange Commission (SEC). Alderoty compared the SEC’s record fines to a professor boasting about widespread failures and cheating, emphasizing that such achievements reflect systemic problems rather than effective oversight. His remarks followed the SEC’s announcement of $8.2 billion in financial remedies, the highest in its history, achieved through 583 enforcement actions during fiscal year 2024.
SEC Chair Gary Gensler lauded the agency’s efforts, describing the Division of Enforcement as pivotal in maintaining market integrity. However, Ripple’s ongoing dispute with the SEC highlights tensions within the regulatory sector. Ripple faced a legal judgment earlier this year, with a $125 million penalty imposed for allegedly selling XRP as an unregistered security.
Ripple’s Legal Battle
The legal battle between Ripple and the SEC began in December 2020, when the SEC alleged that Ripple raised over $1.3 billion through unregistered XRP sales. The initial lawsuit targeted Ripple, CEO Brad Garlinghouse, and co-founder Chris Larsen.
In March, Alderoty revealed that the SEC initially sought $2 billion in penalties. Ultimately, Ripple paid only a fraction of that amount, highlighting the disparity between the SEC’s demands and the final settlement.
Ripple’s encounter with the SEC is among several enforcement actions under Gensler’s tenure. Notably, Gensler recently announced his resignation, effective January 20, 2025. His leadership focused on significant regulatory reforms aimed at safeguarding U.S. capital markets, yet it has also drawn criticism from cryptocurrency advocates.
Ripple’s Advancements in Tokenization on the XRP Ledger
On the positive side, Ripple introduced the first tokenized money market fund on the XRP Ledger (XRPL) in collaboration with Archax and abrdn. Announced on November 25, this initiative integrates blockchain technology into traditional finance. Ripple allocated $5 million to tokens within abrdn’s $4.8 billion U.S. Dollar Liquidity Fund.
This move reflects Ripple’s efforts to expand institutional decentralized finance (DeFi) applications. The tokenized fund aims to enhance operational efficiency while advancing real-world asset (RWA) tokenization. Ripple’s partnership shows the broader adoption of blockchain in financial markets, positioning the XRPL as a leading platform for institutional applications.
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