Once again we are back to square one, and the Ripple vs SEC affair is far from over. In a recent analysis of the SEC lawsuit against Ripple, Zach Rector, a prominent XRP YouTuber and financial expert, speculates that Ripple could face a hefty penalty of over $3 billion if Judge Analisa Torres rules that on-demand liquidity (ODL) are linked. sales are securities. The lawsuit is currently in the appeals phase and the SEC has filed a motion to compel Ripple to produce financial statements and information regarding institutional sales of XRP.
SEC document request still pending
The SEC's recent action took place on January 11 when it submitted a formal request to Southern District of New York Magistrate Judge Sarah Netburn. The request specifically asks the court to require Ripple to submit financial statements and sales contracts.
Despite numerous calls and emails, Ripple has not submitted any post-complaint documents. In defiance of Ripple, the SEC requests two specific documents and an interrogatory.
An analyst pulls the rug out from under the millions at stake, what next?
On the other side, Rector in his YouTube video strong points the potential billions at stake for Ripple, pointing out that the SEC claims the company has sold approximately $3 billion worth of XRP since the lawsuit began. While the SEC's initial claim was significantly higher, legal experts expect a reduction during the appeal process. Rector predicts that the final penalty could exceed the $3 billion mark if Judge Torres considers ODL-related sales as securities.
After so much chaos and the recent SEC decision, there is a possibility of a negative decision. So if that happens, Rector expects Ripple to appeal to the Second Circuit, especially if the judge rules that ODL-related XRP sales constitute an investment contract. Rector suggests that, trusting legal advice, Ripple would likely challenge such a decision.
It is not finished yet…
As Ripple prepares to respond to the SEC's motion to compel, the court action process is expected to conclude by February 12, 2024, with the SEC's final motion scheduled for April 29, 2024. Although There is no official ruling date, pro-XRP lawyer Fred Rispoli speculates that the judge could issue a ruling in early summer, adding a layer of anticipation to Ripple's legal journey.
The court granted both parties an additional month, which is in addition to the date of discovery of the appeals. This timeline gives the SEC time to make its case in court and gives Ripple a chance to say no. There is a lot of talk about a settlement that could be on the horizon since the dates are approaching and Ripple and the SEC have had a history of tensions in the past.