The US Securities and Exchange Commission (SEC) and Ripple Labs are expected to work on settling their legal dispute after the SEC dropped its claims against Ripple’s CEO, Brad Garlinghouse, and co-founder, Chris Larsen. Pro-XRP legal expert John Deaton has explained how this settlement might happen.
However, reaching a settlement won’t be simple. Deaton believes that the SEC is upset and embarrassed and is seeking a $770 million fine from Ripple for breaking securities laws. The penalty phase is complex, similar to a separate legal case, involving various legal procedures and document exchanges.
Ripple wants to significantly reduce the fine, which adds to the complexity. They aim to exclude certain transactions from the penalty that the SEC claims violated securities laws.
Deaton pointed out a similar case involving the SEC and LBRY, which took a long time to resolve with multiple legal filings and depositions.
A final decision from Judge Analisa Torres might not come until late summer at the earliest, and it could take up to a year before any appeal is filed.
Coinbase’s Motion To Dismiss (MTD) could impact the case. If the judge grants Coinbase’s motion, the SEC may have to change its approach and consider settling with Ripple. However, if Coinbase’s motion is denied, a settlement is less likely. Coinbase’s argument against the SEC’s jurisdiction is set for a hearing on January 17, 2024, with a decision expected within 60 to 120 days.