Ripple’s Chief Legal Officer (CLO) Stuart Alderoty revealed in 2020 that the SEC formally requested Ripple to confirm that XRP was a security. The securities agency reportedly offered Ripple a short window for compliance.
Stuart Alderoty, Ripple’s chief legal officer, revealed on social media the contents of the US Securities and Exchange Commission’s (SEC) settlement offer to the company before filing its infamous lawsuit in December 2020.
Ripple to Publicly Acknowledge XRP as a Security
In a post on X (formerly Twitter), Stuart Alderoty, Ripple’s CLO, revealed the contents of the SEC’s settlement offer before it filed a complaint against the company and two Ripple executives in 2020.
According to Alderoty’s post:
“Before the SEC sued Ripple, Chris and Brad (3 yrs ago today) they offered us the following settlement: the SEC would announce to the market that XRP is a security and the market would be given a short window to “come into compliance.”
The SEC famously filed a lawsuit against Ripple, its CEO, Brad Garlinghouse, and co-founder Chris Larson. On December 22, 2020, the securities agency filed a complaint against the company, Garlinghouse and Larson, for selling unregistered securities to raise over $1.3 billion.
Alderoty states that the SEC offered Ripple the chance to publicly acknowledge that XRP is a security asset and offered the company a short window to comply with its regulatory framework.
The CLO explained the company opposed the agency’s suggestion and maintained that XRP is not a security.
“We said no because: (1) XRP is not a security; and (2) the SEC never built a framework for crypto compliance. No matter the spin that Clayton, Hinman, Gensler or anyone else puts on this case now, it was always about one thing – – proving that XRP is not, in and of itself, a security.”
SEC Drops Charges Against Garlinghouse and Larson
Ripple secured partial victory over the SEC after Judge Analisa Torres ruled that the sale of XRP on public exchange did not constitute an unregistered securities offering.
Following the ruling, the SEC dropped the charges against the two executives.
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