The fintech firm has faced some controversies since the US regulator body, SEC, sued the firm for selling unregistered tokens. The US Securities and Exchange Commission sued the firm on December 12, and the suit caused the firm some problems. The firm’s digital asset, XRP, declined rapidly because of the suit, and many prominent exchanges delisted it.
Even as XRPs finally appreciate after the continuous fall, it is clear that the legal battle ahead is still a major challenge. XRP explained that it would try to settle things with the regulator a few months back, but this is looking very unlikely as it changes its stance. Both the regulator and Ripple said that they would not settle before the trial, meaning that major settlement would occur with the court’s presence.
Ripple and SEC wrote a letter to judge
The parties shared this new information through a letter written to a judge following the issues surrounding settlement. The parties sent out the letter on Monday to Judge Analisa Torres.
The parties concluded that they don’t think a settlement would be possible because they had met previously with the intention of settling. Ripple also called out the regulator body for its strict and unclear regulations last year, which got some attention last month.
The fintech company said the body lacks regulatory clarity, which brings confusion in the space. Although the watchdog did not speak on that claim, many felt that the challenges are yet to be over.
The parties also added that Ripple met with Trump’s tenure executives, as many vital personalities in the department are no longer in office. One of the important executives who left the body with the previous administration is Jay Clayton, the former chairman.
The letter explained that the designated chairman is yet to be inaugurated, making a settlement difficult with the tenure change. Apart from the settlement’s conclusion, the group also had debates on witnesses and some information they would take to court.
Parties pretrial conference slated for February 22
SEC had told the judge via the letter that Ripple and one of its executives received two memos that the token would likely be classified as an investment contract and might eventually be called securities based on US federal laws. The fintech firm replied to the letter by explaining that the tokens are virtual convertible currencies and could not be called securities.
The regulatory body then said it would take five confirmations instead of 10 used for allegations while adding that it might ask for documents to confirm the body’s claims.
Ripple fired back that the information that SEC wants is inappropriate as it falls under attorney-client privileges, making the demand improper and with no legal foundation. The legal battle continues as SEC continues to stay firm on its claims that it broke federal law.
The body further explained that the firm sold $1 billion worth of the asset without registering them as securities, making investors vulnerable to some problems. The two parties would make their first pretrial conference on February 22.
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