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- Cardano’s founder opposes the idea of a settlement between Ripple and SEC.
- Pundits argued Ripple might be compelled to burn $20 billion worth of XRP in its escrow.
- Speculation rises on a potential Ripple-SEC settlement as crucial case hearing dates approach.
Speculations about a potential settlement in the drawn-out legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC) are rapidly gaining momentum as crucial dates for the case hearing loom. Of particular note, February 12 marks the commencement of a comprehensive examination of the remedies briefing in the SEC vs. Ripple case.
With this date being two weeks away, some crypto community members speculate that a settlement term may require Ripple to incinerate the over 40 billion XRP tokens held in escrow. Considering XRP’s market value of $0.51, that amounts to setting over $20 billion on fire.
Notably, this speculation draws parallels from the SEC vs. LBRY legal dispute. In the case, the SEC pursued a court order to prohibit LBRY from engaging in crypto offerings until it disposed of all its LBRY Credits (LBC) tokens.
However, online commentators have contested the plausibility of such a scenario in the Ripple case. They argue that since the initial lawsuit against the payment company imposed a $1.3 billion charge on Ripple, incinerating over $20 billion as part of settlement terms lacks logical coherence.
Additionally, X user Simon Whitty highlighted that the only entities with the authority to compel Ripple to burn escrow would be the validators. However, he asserted that such action would be highly unlikely to occur.
You live in a dream world Ripple has already said publicly that they could not see any reason to burn escrow. The settlement will be a fine to pay northing to do with escrow. The only people who could force Ripple to burn escrow would be the validators but that would never happen— Simon Whitty (@SimonWhitty2) January 29, 2024
Besides, legal expert Bill Morgan previously stated that although the judge could issue an order for the escrowed XRP to be burned, XRP Ledger validators would not necessarily be bound by such a directive.
Meanwhile, influential figures in the crypto sphere, like Cardano founder Charles Hoskinson, have raised concerns about the potential ramifications of a settlement between Ripple and the SEC.
In particular, Hoskinson had argued that if Ripple were to settle with the SEC, it would imply an admission that XRP was, in fact, a security. He contended that while this might resolve immediate challenges for Ripple, it could also confer legitimacy and authority to the SEC to pursue analogous arguments against other Layer 1 cryptocurrency projects.
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