By Ripple filed a new motion in its ongoing legal battle with the U.S. Securities and Exchange Commission (SEC). In the latest filing on May 29, Ripple dismissed claims that it suppresses the XRP price through over-the-counter (OTC) token sales.
According to the filing, Ripple no longer conducts OTC XRP sales transactions. Instead, the company sells XRP to customers through its ODL (On-Demand Liquidity) product, which does not offer discounted pricing like the OTC deals.
Ripple Claims No More OTC XRP Sales
“Ripple’s current sales of XRP to customers for use in connection with Ripple’s ODL product do not have any of the relevant terms of the over-the-counter contracts, such as discounts offered to sophisticated counterparties,” the filing stated.
The statement challenges the claim that Ripple intentionally suppresses XRP’s price by dumping tokens on retail investors through discounted OTC sales.
Legal analyst Bill Morgan noted that the evidence suggests that Ripple did not offer any pricing discounts to its ODL customers.
#XRPCommunity #SECGov v. #Ripple #XRP @Ripple has filed a reply letter in further support of its Motion to Seal documents in connection with the @SECGov’s Motion for Judgment and Remedies. pic.twitter.com/NeuFZII1m8
— James K. Filan (@FilanLaw) May 29, 2024
Ripple’s latest filing argued that ODL sales of XRP have no impact on the token’s price, which has consistently underperformed Bitcoin and the broader crypto market.
Ripple also claimed its financial statements were irrelevant to the court’s analysis, as it could pay potential SEC fines and penalties.
The latest filing came after the SEC opposed Ripple’s motion application to seal and redact the company’s details in the parties’ briefings on remedies, as Ripple insisted that revealing such sensitive financial information could harm its business operations.
Ripple’s Last Court Filing and the Fate of the SEC Legal Battle
As the long-running legal battle between Ripple and the SEC nears its end, the backstory of the court filing shared by defense attorney James Filan on May 15 is crucial to understanding recent events.
The filing centered around Ripple’s Motion to Seal, which seeks to protect a selection of documents related to the SEC’s Motion for Judgment and Remedies.
Ripple wants to seal sensitive and confidential materials, such as audited financial statements and documents outlining existing business relationships.
The blockchain firm argued that these audited financial statements and related documents are non-public, supporting the need for their redaction.
Ripple’s Chief Financial Officer, Jonathan Bilich, filed a declaration supporting the company’s Motion to Seal, emphasizing the confidential nature of the information.
@Ripple CFO Jonathan Bilich has filed a Declaration in Support of @Ripple‘s Motion to Seal.https://t.co/r1dvt2vgPq
— James K. Filan (@FilanLaw) May 14, 2024
With the SEC and Ripple progressing through the final stages of the case, speculation about the potential penalties for Ripple’s alleged breach of U.S. securities laws is intensifying.
A court ruling siding with the SEC’s proposed $2 billion penalty – a request Ripple has already opposed by suggesting a $10 million and an injunction prohibiting XRP sales to institutional investors – could greatly impact buyer demand for the XRP cryptocurrency.
A corrective penalty could also propel the SEC to appeal against the Programmatic Sales of XRP ruling. Recall that in October 2023, the SEC dropped charges against Ripple’s founder and CEO after the court rejected an interim appeal, forcing the regulator to wait until the case ends to appeal the XRP sales ruling.
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