Crenshaw criticized the agency for significantly weakening the impact of the court’s original order. In her view, the settlement dilutes the authority of the judiciary and the SEC’s ability to enforce securities laws. She expressed concern that this compromise will set a troubling precedent, suggesting that the SEC’s leadership may be intentionally stepping back from a strong legal position.
SEC Allegedly Fears Losing in Higher Court
Interestingly, Crenshaw accused the SEC of being afraid to pursue its appeal further. She believes the current leadership fears that the Second Circuit Court of Appeals might affirm the original legal arguments laid out by the Commission. “Our agency is, I fear, worried that the appellate court would issue a sound ruling that agreed with the legal arguments already laid out by the Commission,” she stated.
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The new agreement reduces Ripple’s original $125 million fine, which Judge Analisa Torres previously ordered, to $50 million. Additionally, it lifts the injunction that had prohibited Ripple from selling XRP to institutional investors. This outcome marks a significant shift from the penalties previously imposed on the blockchain company.
Next Steps in the Legal Process
Although the case remains with the Second Circuit Court of Appeals, it cannot be officially concluded until it is returned to Judge Torres. The judge must now decide whether to accept the reduced penalty and permanently remove the injunction. The case will be formally resolved once both Ripple and the SEC withdraw their respective appeals.
Related article: Ripple Moves Closer to Victory as SEC Withdraws Legal Objection
Despite the remaining summary judgment ruling, Crenshaw believes the settlement leaves the door open for future violations. She warned that if Ripple were to sell unregistered XRP tokens to institutions again, the SEC would likely take no action.
Her statement underscores growing concern that this deal signals a broader retreat from rigorous crypto enforcement.
