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HomeCrypto NewsMarketExpert Says Ripple Potential Penalty of $770M Could Fall to $38.5M

Expert Says Ripple Potential Penalty of $770M Could Fall to $38.5M


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Deaton believes Ripple might pay a lower fee as penalties, making it difficult for the SEC to justify the amount of resources it spent during the legal battle.

Attorney John Deaton, a legal representative for the XRP community, has continued to shed light on the potential outcome of the upcoming remedies phase in the SEC v. Ripple lawsuit.

$731.5M Could Be Deducted From Penalty

In a tweet yesterday, Deaton speculated that Ripple could pay a lower amount as penalties instead of the $770 million fine the SEC seeks.

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It is worth noting that the $770 million emanated from Ripple’s XRP sales to institutional clients, which the court found illegal in its July 13 ruling. As a result, Ripple could pay a fine of up to $770 million for violating federal securities laws through its institutional sales.

Interestingly, Attorney Deaton said Ripple could pay a lesser amount as penalties due to the SEC’s previous arguments. According to Deaton, the SEC mentioned in some of its briefs that 95% of Ripple’s XRP sales could be outside the United States.

Applying the figure to the $770M worth of XRP sold to institutional clients, Deaton noted that a whopping $731.5M will be deducted from the total sum, leaving only $38.5 million.

In addition, Attorney Deaton argued that Ripple would attempt to deduct legitimate business expenses from the expected penalties. Per Deaton, the SEC cannot justify the amount of resources it splashed on the Ripple case after the company pays the fine.

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Deaton Highlights How Ripple Could Secure a 99.9% Victory

Deaton commented a few hours after he rebuked crypto people who claim the SEC obtained a 50-50 victory. The XRP holders’ attorney stated that the court’s ruling was more like 90-10 in favor of the blockchain company.

Furthermore, the pro-XRP lawyer speculated that Ripple could end up with a 99.9% victory against the SEC if it pays only $20M or less as a fine.

It bears mentioning that the SEC v. Ripple case is currently in the remedies phase. The court has ordered the parties to submit a joint briefing schedule about the remedies on or before November 9.

However, if the parties fail to come to an agreement before the deadline, they shall jointly ask the court to provide a schedule for the briefing.

Attorney Hogan Outlines Ripple’s Potential Argument 

As the deadline approaches, top lawyers have been speculating on potential arguments the blockchain company might adopt during the remedies briefing.

Interestingly, Attorney Jeremy Hogan joined the discussion in a recent tweet. Citing the SEC v. Liu case, Attorney Hogan stated that the court found that disgorgement needs to be fair.

Consequently, Hogan asserted that Ripple would deduct its legitimate business expenses from the potential $770M penalties. He also predicted that sales outside the U.S. SEC jurisdiction would be removed from the total sum.

Furthermore, Attorney Hogan mentioned that the recent Second Circuit ruling, which held that disgorgement should be awarded for victims, could also play a significant role during the remedies briefing. As reported earlier, Hogan stated that XRP holders would need to have suffered financial damages for Ripple to be held liable.

Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.



Lele Jima
Lele Jima
Lele Jima is a cryptocurrency enthusiast and journalist who is focused on educating people about how the nascent asset class is transforming the world. Aside from cryptocurrency-related activities, Jima is a lover of sports and music.

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