SEC Removes Major Fundraising Roadblock for Ripple
The regulator threw the company a bone, letting it bypass Regulation D restrictions
Welcome to the Monday edition of the Crypto In America newsletter!
What you’ll read: SEC grants Ripple a key waiver; Elizabeth Warren lays out her wish list for market structure legislation; economic data to watch this week.
Following its joint dismissal of appeals that wrapped up a five-year legal battle with the Securities and Exchange Commission, Ripple got a big break from the regulator that will make it easier for the company to raise money.
As part of the district court’s 2023 ruling, Ripple was hit with a permanent injunction for past securities violations that would normally block the company from using Regulation D, a shortcut for raising private capital from accredited investors without full SEC registration.
But on Friday, the SEC granted Ripple a special waiver, citing “good cause” to lift the restriction because the Commission had previously agreed to dissolve the injunction as part of a May settlement between the parties.
The waiver doesn’t erase Ripple’s past violations, but it clears the way for the company to sell XRP to private investors, fuel operations, and expand its business without the fundraising roadblock, essentially bypassing the consequences of the court’s orders.
Former SEC lawyer Marc Fagel calls it a bold move by the agency.
“The SEC expressly references their desire to undo the injunction, which the district court pointedly denied. It’s a pretty blatant FU to the court.”
Bottom line: The injunction stays on paper, but Ripple can now raise private capital freely under Reg D — a big win for the company’s growth plans.
Warren’s Market Structure Wish List
Crypto’s fiercest critic, Senator Elizabeth Warren, doubled down over the weekend, demanding tougher rules for the industry ahead of the Senate’s return to tackle market structure reform in September.
The progressive senator from Massachusetts has long pushed to rein in crypto, warning that it poses consumer risks and threatens national security. She’s also been vocal about the need for stronger stablecoin regulation, opposing the recently passed GENIUS Act over concerns it didn’t go far enough to protect consumers.
In a Sunday interview with MSNBC, she called for tougher market structure legislation that provides safeguards for investors and prevents elected officials from exploiting crypto markets for personal gain.
“We need regulation that limits corruption and the ability of elected officials to trade in it... that limits the ability to blow up the economy with crypto... and that has adequate consumer protection.
Some industry watchers welcomed Warren’s acceptance that crypto legislation is necessary. Some noted she didn’t criticize the recently passed GENIUS Act but focused on what she wants to see in market structure legislation.
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Key Economic and Inflation Data This Week
Here’s what we’re watching at the intersection of Wall Street and Washington:
Tuesday
6:00 AM ET: National Federation of Independent Business releases its Small Business Optimism Index
8:30 AM ET: Bureau of Labor Statistics releases July Consumer Price Index (CPI)
Thursday
8:30 AM ET: The Bureau of Labor Statistics releases July Producer Price Index (PPI)
Friday
8:30 AM ET: Commerce Department releases latest retail sales data
8:30 AM ET: New York Fed releases monthly manufacturing survey
10:00 AM ET: University of Michigan releases preliminary consumer sentiment survey
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