On Thursday, the US Securities and Exchange Commission (SEC) dismissed the charges it had filed against Ripple’s Executive Chairman and CEO, Chris Larsen and Brad Garlinghouse, respectively, voluntarily.
The securities regulator had charged the two executives together with the company for violation of securities laws because of the sale of the XRP token.
In a press release issued by Ripple, the company referred to SEC’s move as a ‘stunning capitulation’. Stuart Alderoty, the Chief Legal Officer at Ripple, called the move a surrender by the regulator.
After the news broke, the price of the XRP token recorded some upward action, which saw it rise by 5% for the day.
Larsen and Garlinghouse had been charged with Ripple in late 2020 for violation of securities laws through the distribution of the XRP token.
A federal judge ruled in July that the XRP token could not necessarily be defined as a security and that the programmatic sales of the token on exchanges could not be considered securities offerings.
This had been a major victory for the crypto firm. The SEC had tried to convince the same judge earlier this month to overturn the ruling before a final judgment is issued in the case next spring.
Chris Larsen, the Executive Chairman, said that the lawsuit had been flawed since the day it had been filed and they had had to defend themselves against the ill-advised attack.
He said that justice prevailed eventually, but they had to question the actions of the government and the motivations behind them that led to this point.
It remains unclear as to why the charges were dropped by the SEC against Larsen and Garlinghouse, but the move could have come after the agency recently suffered a string of losses in court against Ripple.
Nonetheless, the regulator is still moving forward with its overarching case against the company, which has been defined as a legal showdown that will help establish crypto regulation in the country.
Therefore, it is not surprising that Ripple’s fight against the SEC has been supported by a number of players in the crypto space, which include Coinbase, the crypto exchange based in the US.
While the recent series of legal victories is definitely encouraging for Ripple itself, the crypto market also got a boost after the favorable ruling was announced back in July.
There had been a rise in the value of the overall market by almost $73.5 billion. However, this does not mean that the company or the market is out of the woods as yet.
The judge overseeing the lawsuit between Ripple and the SEC had also ruled in July that the sale of the XRP token to institutional investors was indeed an illegal securities offering.
In addition, the SEC has also filed lawsuits against a number of other prominent players in the crypto space, which include Binance, Coinbase, and Tron.