Today Bitcoin pops as new data waves off Fears of a weakening US Labor Market a Judge orders Ripple labs to pay about $125 million to the SEC but that's less Than the regulator wanted and Ripple's Chief legal officer steuart Alder Roi Talks to us about that Ruling welcome to cmc's crypto world I'm Mackenzie sigalos cryptocurrencies are Surging this morning with Bitcoin Popping 6% by Eastern ether is also Rising alongside Bitcoin gaining nearly 4% and Ripple's native xrp token climbed A whopping 22% after the company was hit with $125 Million in penalties in its case with The SEC now that figure is a fraction of What the agency was seeking in its legal Battle with ripple more on that in just A second now this crypto bounce Coincides with a rally on Wall Street as Investors breathe a sigh of relief for The US economy new data out this morning Sooe fears of a weakening us labor force And wall Street's more hopeful now that We'll avoid a recession taking a quick Look at where crypto Focus stocks stand At 12:45 Eastern coinbase jumped about 6 And a 12% micro strategy nearly 5% while Miners Riot and Marathon digital both Gained 85% taking a look at two companies that Reported earnings yesterday after the Bell Robin Hood and core scientific they
Are in the green Robin Hood reported Cryptocurrency revenues That Grew 161% From A year earlier to $81 million while The company's overall net income grew to $188 million in the quarter compared to Just 25 million a year earlier meanwhile Core scientific reporting a net loss of $85 million as the company doubles down On AI and continues to retrofit its Mining sites with high-powered Computing Hardware okay let's talk about the top Stories a federal court court ordered FTX and its sister company Alam to pay Nearly $13 billion back to customers in A filing on Wednesday the judge in the Southern district of New York approved a Consent order directing the two Companies to pay a combined 12.7 billion To creditors now that payout would end a Lawsuit brought by the cftc back in December of 2022 shortly after s spf's Crypto Empire collapsed this order also Prohibits FTX and its sister hedge fund From Trading digital asset asss in the Future next a federal judge ordered Ripple labs to pay the SEC about $125 Million in penalties much less than the $2 billion that the agency had sought in A legal battle that began about 4 years Ago the Civil penalty is related to Charges of improperly selling its xrp Token to institutional investors now you Might remember in July of last year US District Judge Analisa Torres in
Manhattan granted Ripple a partial win In the case finding that sales of xrp on Public exchanges were not considered Unregistered Securities offerings the Judge subsequently rejected a request by The SEC to appeal that ruling now Yesterday evening Ripple CEO Brad Garlinghouse reacted to the decision Writing that the SEC had asked for $2 Billion and the court reduced the Agency's demand by about 94% quote Recognizing that they had overplayed Their hand he called the ruling of Victory for ripple the industry and the Rule of law adding that the sec's Headwinds against the whole of the xrp Community are Gone all right for more of that order in The Ripple case I spoke to the company's Chief legal officer Stuart Alder Roi he Also took to X yesterday calling the Order a final judgment he wrote that the Court rejects the's suggestion that Ripple acted recklessly and reminds the Agency that this case did not involve Any allegations of fraud or intentional Wrongdoing and that no one suffered any Financial harm when speaking with Alder Roi this afternoon he reacted to the Judgment and explains what's next for Ripple so I saw your post on X yesterday Reacting to a judge finding Ripple $125 Million after ruling that institutional Sales of xrp violated Federal Securities
Laws and he called the sec's request for $2 billion in fines and penalties an Absurd demand and wrote that you Actually respect that $125 million fine That the court has imposed how are you Feeling about this final outcome to a Long and protracted legal battle with The SEC we're feeling really good about it Um Ripple when it was first sued by the SEC almost four years ago uh said that We were going to defend this case not Only on our own behalf but on behalf of The entire crypto industry uh this Administration uh with this SEC under This chair has clearly taken an Anti-crypto stance and has engaged in a War on crypto that's playing out in the Courts um I think they lost on Everything that was important to them uh Trying to establish that a token itself In this case xrp can be considered a Security was soundly rejected by the Court and what the court said is a token Is never a security in and of itself Just like a bar of gold uh is never a Security you can certainly package Commodities or virtual currencies up and Sell them as Securities but they're not Securities in enough themselves and That's the core Clarity that we sought In this case and the establishing that Xrp is not in and of itself a security Is the law of the land what the judge
Did find is that certain historical Sales uh beginning uh around 200 15 um The way that those sales were packaged With sophisticated third parties they Should have been registered under the Securities laws and that's the piece of The um uh the decision that we respect Um the the judge rejected a $2 billion Ask from the SEC because she found that Ripple didn't act recklessly we didn't Act with any intention to defraud Anybody and in fact there were no Victims the counterparties to those Transactions suffered no Financial loss At all uh but staying true to the law Since there was a technical violation of The failure to register those historical Sales she did impose a fine of $125 Million That's something that we will pay with Cash off of our balance sheet and we Look forward to moving forward and Hopefully this turns a page not only for Ripple but also hopefully finally this Administration will turn the page on Their war on crypto and uh hit the reset Button let's talk about some of the next Steps here by when is Ripple obligated To pay that fine and when that happens Is that the end of this chapter that Started back in December 2020 when the Slat Ripple with charges or do you Expect an appeal from the SEC can that Even happen at this stage or are we
Finally done with this uh legal battle Well in our in our minds we are finally Done um the the fine pursuant to the Court's order needs to be paid in 30 Days and uh we will do that the SEC uh Certainly has the option to pursue an Appeal I think they've got 60 days to Make that determination but again um We're we're focused on the finality that This order uh gives Ripple we want to Focus on continuing to grow our business Both um globally and domestically uh we Like the clarity that uh this lawsuit uh And the outcome of this lawsuit has Provided to us um and that's where That's where we're going to be focused On and again uh if the SEC um is a Rational actor uh and they are um and This Administration truly is serious About hitting the reset button on their War on crypto there should be no appeal And everybody should be moving On now a lot of people saw the initial Ruling on xrp as a big win not just for Ripple but the crypto ecosystem as a Whole you run Ripple's legal team any Big takeaways on what this means for Your company in particular and also the Industry more Broadly I I think um I I think it has a Tremendous impact positive for ripple And a tremendous impact positive for the Industry more broadly uh Ripple when we Were first sued in December of 2020 as I
Noted earlier we said look we're going To defend this case not only because we Think the uh allegations that are being Made against our company are Wrong-minded and we think ultimately They're not going to be able to survive Um judicial scrutiny but we're going to Defend it on behalf of the entire crypto Industry because we knew that we were The tip of the sword we knew that the SEC would start with ripple and then Start working their way down and uh Bring litigation uh in lawsuits and Enforcement actions against the rest of The industry I'm not sure everyone Believed us four years ago everyone Believes us now because that's exactly The Playbook that the SEC has sought to Advance and what do we now know we know Through our case the court has um found That the SEC was not engaging in a Faithful aliance to the law that's a Quote we know in the Bitcoin ETF case a Another Court found that the SEC was Acting arbitrarily and capriciously we Know that there was a federal judge in Utah that sanctioned the SEC for uh Engaging in outright fraudulent Misrepresentations to the court so this This war on crypto has really skewed the Sec's core Mission and skewed their Commit to kind of stick to their Lanes In their jurisdiction and what we need As a country is to hit the reset button
And what we really should be focusing on Is creating clear laws rules and Regulations so this industry can thrive In the United States just as it is Thriving outside of the United States Now a lot of this goes back to the same Issue that industry players have been Talking about for years something that You've brought up a couple of times just Today there are no hard and fast rules On crypto from Congress and abs that the SEC has been seen as policing the space Through these enforcement actions we Have seen some progress in DC with fit21 But still the US doesn't have a clear Framework we're about to have a change In the White House how are you Navigating the continued legal ambiguity In the states are you I mean considering Decamping abroad or are you finding ways To make it work uh here in here in the US well uh since uh December of 2020 Ripple has grown our business Exponentially but 90% of that growth has Occurred offshore in Singapore in the EU In London in Dubai in Brazil all under Regulatory supervision and with Regulatory permission unfortunately the Ability to grow our business in the US Has been hamstrung and the ability to Grow crypto in the US has been hamstrung So these jobs these tax dollars these Great mindes that are um uh backing and Developing this Innovation they're all
Moving offshore so we need a clear set Of laws rules and regulations in the US For crypto the SEC appointing themsel Selfa appointing themselves as the Crypto cop on the beat uh for um for This industry has been a failed strategy As we prove it in our case their Jurisdictional um bre has limits and They can't Supervise Industries or they can Supervise transactions that are not in And of themselves security transactions And simply calling crypto Securities Because you want to supervise it doesn't Make crypto a security and that's what We have established clearly in our case So we're very invested in a good policy Outcome uh we engage on both sides of The aisle on this and we're hoping again Uh that um uh the combination of our Litigation outcome the combination of The election season we're in we can Really see a reset button here and we Can finally move away from wasting tax Dollars on victimless charges in courts And building IR rational and practical Framework for the crypto industry in the United States aler Ro also discusses his recent Political donations and his reasoning Behind them you'll be able to check out His full interview over at cnbc.com Cryptoworld okay that's all for crypto World today but we'll be back again
Tomorrow and we'll see you then [Music]
