In a candid 60-second video, Ripple’s Chief Legal Officer Stuart Alderoty explained that the U.S. Securities and Exchange Commission’s decision to drop Ripple’s case underscores a change in the regulator’s approach to cryptocurrency enforcement.
“The SEC has not only dropped its appeal against Ripple, they’ve now dropped every case against every crypto company in the United States,” Alderoty stated.
‘Explain what the law is’
Alderoty says the SEC has finally acknowledged what the crypto industry has long argued. Enforcement actions cannot be brought without first establishing clear regulatory guidelines.
“You can’t bring enforcement actions for violating the law without first explaining what the law is,” he emphasized.
Alderoty pointed to the absence of clear laws, rules, and regulations regarding cryptocurrency in the U.S.
Throughout its legal spat, Ripple maintained that the SEC was attempting to regulate through enforcement rather than proper rulemaking.
The case began in December 2020 and centered on whether XRP should be classified as a security. It became one of the crypto industry’s most closely watched cases.
With the legal obstacles now cleared, Alderoty shared Ripple’s forward-looking strategy.
“We’re going to clean up the mess, we’re going to get out of the courtroom, we’re going to get back to running business,” he said. The company plans to work with Congress to bring smart crypto regulation that “protects consumers, protects the integrity of the market, keeps bad actors out, and most importantly, allows innovation to flourish.”
In 2023, the court gave Ripple a partial win: institutional sales were legal, but XRP sales on public exchanges did violate securities laws. Ripple originally set aside $125 million in escrow for potential penalties, which CEO Brad Garlinghouse promised to take back.
“I think it’s just evidence that the former [Gary] Gensler SEC was on the wrong side of the law. And thanks to the new leadership at the SEC and in the White House,” Garlinghouse recently told Fox Business.
The timing of this legal resolution aligns with Ripple’s aggressive expansion plans. The company recently completed its largest acquisition with the purchase of Hidden Road for $1.25 billion.
Alderoty’s and Garlinghouse’s comments come as the SEC finds itself under new leadership. Trump appointee Paul Atkins is now chair, and the agency’s withdrawal of all crypto enforcement cases is a recognition that its approach to cryptocurrency oversight has fundamentally changed.
It’s worth noting that Ripple supported President Trump by donating millions to his presidential campaign and at least $5 million in XRP tokens to the inauguration on Jan. 20.
