Ripple Must Hand Over Financial Records to SEC, Judge Rules - 2024-02-06

A U.S. judge has demanded Ripple Labs hand over historical financial statements, fulfilling a request that the Securities and Exchange Commission made many years ago, court documents show.

In a Monday filing, Judge Sarah Netburn sided with the SEC and ordered Ripple to produce its records from 2022-2023. Ripple will also have to answer questions about the amount of XRP institutional sales proceeds it received.

Ripple Labs argues that its financial documents are "highly confidential." Last month, the fintech company challenged the SEC's request to release financial documents.

Ripple, the fintech company whose founders created the XRP cryptocurrency, has had issues with the SEC since 2020 when the regulator hit the fintech company with a $1.3 billion lawsuit for allegedly selling unregistered securities in the form of XRP.

But last year, Ripple scored a partial win in the courts against the SEC when a judge ruled that programmatic sales of XRP to retail investors did not qualify as securities.

Despite the judge saying that $728 million worth of contracts for institutional sales did constitute unregistered securities sales, investors and Ripple Labs interpreted the partial ruling a win for the broader crypto industry.

Last month, Ripple CEO Brad Garlinghouse slammed Wall Street's biggest regulator, calling the SEC "very hostile." He added that SEC Chairman Gary Gensler was a "political liability" and that his way of regulating the crypto industry wasn’t working.