Ripple Might Consider New Settlement Terms, Says XRP-Friendly Lawyer

Updated: 02 May 2023

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As the Ripple-SEC lawsuit continues to unfold, XRP-friendly lawyer, John Deaton, has weighed in on the ongoing rumors about a settlement in the lawsuit between the Securities and Exchange Commission (SEC) and Ripple. Deaton has suggested that Ripple may consider new settlement terms based on the outcome of the ongoing litigation.

Deaton, who is closely following the case, took to Twitter to discuss various scenarios that could impact Ripple’s decision to settle or not. This comes amid recent rumors of an undisclosed meeting between Ripple and the SEC. The rumors have since been debunked by a Fox Business reporter. According to Terrett, who has extensively covered the lawsuit for a while, the meeting is not happening.

Would Ripple Consider New Settlement Terms?

Deaton was also quick to respond to the rumor, giving a legal opinion on how settlements happen. According to Deaton, the terms of a potential settlement would depend on the specifics of the court’s ruling. One key consideration is whether major crypto exchanges like Coinbase and Kraken would immediately relist XRP or wait for an appeal by the SEC.

Another is whether Ripple’s partner, Bank of America, would feel comfortable with the decision or wait to see if Judge Torres’ ruling gets overturned in the event of an SEC appeal.

Quite a few people ask why would Ripple settle if they won. First, I didn’t say Ripple would agree to the same terms of a settlement they would’ve agreed to 2 years ago. It all depends on the ruling itself. Does Coinbase and Kraken immediately relist or wait for an appeal? https://t.co/sCx24acPR4

— John E Deaton (@JohnEDeaton1) May 2, 2023

Deaton emphasized the SEC could file a notice of appeal and withdraw it later, leaving room for further negotiation. He also mentioned a hypothetical situation in which the SEC would agree not to appeal if Ripple paid a $50 million settlement and received assurance that future sales of XRP would not be considered securities.

Here, he believes that Ripple CEO Brad Garlinghouse would be quick to sign off on the settlement, as it would provide certainty and immediate return of liquidity to the U.S. market.

If the SEC told Ripple it would issue a statement that all future sales of #XRP are not securities (not saying it would) and not appeal if Ripple agrees to pay $50M, I believe the certainty and immediate return of liquidity to the U.S., makes @bgarlinghouse ✍️ a check in seconds.

— John E Deaton (@JohnEDeaton1) May 2, 2023

However, if Judge Torres’ decision is in Ripple’s favor and restores liquidity to the U.S. market without causing businesses to worry about SEC repercussions, Ripple may be more inclined to forgo a settlement.

Additionally, Deaton said that SEC and Ripple legal teams are free to meet their wish. However, according to the lawyer, they would not pick a date that is a week away and leak it to the public. This is because the legal teams do not want to face claims of market manipulation and insider trading and risk accusations of influencing the market.

The SEC sued Ripple in December 2020, alleging that the company issued unregistered securities offering by selling XRP. Ripple has denied the allegations, and the case has been ongoing ever since.

The case has had a significant impact on XRP, which was delisted from many major exchanges following the lawsuit’s filing. XRP’s price also dropped significantly, although it has since recovered somewhat. The outcome of the Ripple-SEC legal battle will undoubtedly impact the future of XRP and its relationship with U.S. regulators.

XRP Supporters

The crypto community is closely following developments in the case, with many hoping for a positive outcome for Ripple and XRP. Some XRP supporters have even launched a grassroots campaign to influence the case’s outcome, with many sending letters to SEC Chairman Gary Gensler and other officials asking them to drop the case.

Many hope that a settlement or a favorable court ruling will help restore liquidity to the market and bring XRP back into the mainstream. For now, all eyes are on the Ripple-SEC legal battle and what it could mean for the wider crypto industry.