Ripple is siding with Terraform Labs by taking a firm stand against the Securities and Exchange Commission levying a penalty charge against the company. In Ripple’s opinion, the court should discard the settlement issue.
Recently, the SEC asked the founder of Terraform, Do Kwon, to make a payment of $3.58 billion towards disgorgement, along with an additional amount of $420 million, in terms of a civil penalty. This makes the entire settlement reach the figure of $4.47 billion. This was about Kwon and his business duping investors regarding their crypto items. In the understanding of the SEC, this led to investors parting with roughly $40 billion worth of assets.
When calculated, it was understood that the SEC’s settlement amount stood for 1.27% of his company’s gross sales, amounting to $33 billion. Ripple found the situation to be completely illogical. The company filed a supplementary authority notice, mentioning that the sEC, in the past, has penalized businesses with a lesser amount, despite the irregularities being more grave.
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In Ripple’s viewpoint, there are no signs of any real malpractices, nor have the investors filed any serious claims as to their losses incurred. The entire matter, according to the company, seems to be unjustified on the part of the SEC.
As per Do Know, the penalty amount should, at no point in time, cross the $10 million mark. It is simply a case of him not being in a financial position to even think of paying such a large amount. It has only $75 million in the form of assets under management (AUM).
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The CLO of Coinbase, Paul Grewal, too spoke regarding the unfair scenario surrounding the whole case.
