KEY POINTS
- Ripple previously opposed the SEC's motion to reveal its 2022-2023 financial statements
- The SEC argued in its motion that the statements can help the court decide on penalties over Ripple's violations
- The regulator's 2020 case against Ripple accuses the company of selling unregistered securities in the US
The U.S. Securities and Exchange Commission (SEC) on Monday bagged a win in its case against payment protocol and exchange network Ripple as a New York judge ordered the cryptocurrency firm to share its financial statements with the regulator.
Court documents dated Monday and signed by U.S. Magistrate Judge Sarah Netburn showed that Ripple has been "ordered to produce its post-complaint contracts" as requested by the SEC.
Last month, the SEC filed a motion to compel Ripple to produce its 2022-2023 statements, saying the statements were necessary to allow the court to determine appropriate penalties for the crypto network's violations in its sales of XRP tokens to institutional investors.
Ripple filed a response on Jan. 19, opposing the SEC's request for its financial statements. "The SEC has failed to justify each of its requests on the merits. They are irrelevant" to the case, the company said in its defense.
However, Monday's court documents showed that the court "sees no basis to short-circuit that inquiry by denying access to readily available information that may be probative to the remedy stage."
The SEC's request was "granted in full" by Netburn, as the New York judge said the commission "credibly" argued how Ripple's "post-complaint conduct" can help determine the decision on Ripple penalties.
The latest developments in the case come years after the SEC's 2020 lawsuit that accused Ripple of selling unregistered securities in the U.S.
Judge Analisa Torres's July 2023 ruling, that XRP programmatic sales and exchange sales cannot be considered as securities sales, was considered in the industry as a huge win for Ripple. SEC chair Gary Gensler expressed disappointment over the ruling, vowing that consumers will see more enforcement of crypto regulations.
Ripple isn't the only crypto firm that the SEC has brought to court. It also filed a fraud lawsuit against Binance, the world's largest centralized crypto exchange by trading volume. The exchange has formally requested to dismiss the lawsuit, which is considered as the most significant hurdle that Binance faces in the U.S.
The SEC also filed a lawsuit against Coinbase, another huge crypto exchange platform, accusing the exchange of providing crypto trading and staking services without registering with the regulator.
Coinbase followed after Binance's footsteps, challenging the SEC's lawsuit by requesting for the case's dismissal.
Meanwhile, talks of the possible launch of an exchange-traded fund (ETF) of Ripple's blockchain technology XRP Ledger recently heated up after global asset management powerhouse Franklin Templeton highlighted the potential of the XRP Ledger.
The SEC has approved 11 spot Bitcoin ETFs, but it remains to be seen how the regulator will respond to the possibility of an XRP ETF.
