SEC failure backs Ripple in institutional sales dispute

In a dramatic development, popular cryptocurrency platform Ripple and its dedicated community are celebrating a major victory following the recent legal crackdown against the U.S. Securities and Exchange Commission (U.S. Securities and Exchange Commission).

The Second Circuit Court’s ruling in SEC v. Govil has created a wave of optimism in the Ripple community, indicating that the SEC cannot demand huge payouts without concrete evidence that investors have suffered financial losses.

At the same time, this pivotal moment was summarized as “no harm, no fault,” and has far-reaching implications for Ripple’s ongoing legal battle with the SEC.

Ripple’s Responsibility for Balances

Legal analyst Jeremy Hogan’s analysis highlights key factors in determining Ripple’s liability. It depends on whether XRP investors actually suffered losses.

In other words, Ripple can escape liability for any financial losses if investors purchase XRP at a price below its current market value. This interpretation puts the SEC in a precarious position that could lead to a resolution more favorable to Ripple.

Meanwhile, much of the discussion surrounding this legal saga has focused on the harsh penalties the SEC is demanding from Ripple.

Commentator Yassin Mobarak expressed doubts about the SEC’s ability to enforce a $770 million fine on institutional sales without investors being significantly affected.

In addition, attorney John Deaton also participated in the discussion, pointing out that in a previous case, the SEC’s initial request for $23 million was ultimately reduced to $130,000. Deaton predicts a similar outcome in the Ripple case, meaning the company may be able to successfully negotiate a fine.

XRP community reaction

Stuart Aldrotti, Ripple Chief Legal Officerunderscores the significance of the Second Circuit’s ruling in SEC v. Govil, which challenged the SEC’s authority to order substantive relief without providing substantial evidence of investor harm.

This concept, understood simply as “no harm, no crime,” could have a significant impact on Ripple’s legal issues with the SEC.

At the same time, Pro-XRP lawyer Bill Morgan commented on the X platform that the fact that the lawsuit between the SEC and Govil revolves around fraud allegations is obvious.

The equitable relief sought by the SEC must be discretionary and designed to compensate victims rather than provide a windfall benefit to the SEC or the government.

At the same time, the key question now is what evidence, whether from experts or other sources, can prove the actual financial losses suffered by institutional investors in this case.

Notably, the Ripple community, buoyed by this legal victory, is eager to achieve a more favorable outcome in its ongoing battle with the SEC.