The US Securities and Exchange Commission (SEC) has rejected Ripple Labs' proposed $10 million fine for selling XRP to institutional investors, insisting on a $2 billion penalty. The SEC believes that Ripple's proposed punishment is too lenient.
In December 2020, the SEC filed a lawsuit against Ripple, alleging that it had sold unregistered securities in the form of XRP worth roughly $1.3 billion. In July 2023, Judge Analisa Torres ruled in favor of Ripple, stating that program sales and other token distributions do not constitute the offering and implementing investment contracts. However, the judge also ruled that selling coins to large industry players violated US securities laws.
In a recent appeal, the SEC questioned Ripple's integrity, highlighting the risks of further law violations by the company. According to the SEC, Ripple has been trying to downplay its responsibility while emphasizing its cooperation with the authorities since the initial offering of XRP coins in 2013.