SEC Claims Recent Court Win Weakens Ripple’s Core Argument

In a supporting letter filed Tuesday, the SEC alleged that Ripple’s “fair notice” argument is moot, based on a recent, separate court win for the regulator


Vector-3D/Shutterstock modified by Blockworks


The SEC has claimed that its recent win against broker dealer Commonwealth Equity Services should be taken into account in its Ripple lawsuit, which could end with a summary judgment any day now. 

In a supporting letter filed Tuesday, the SEC says Ripple’s “fair notice” argument is moot, based on a recent court win for the regulator. The SEC successfully shut down this same defense argument in its case against Commonwealth, which it sued in 2019 for conflict of interest violations. 

Ripple’s fair notice defense is based on a recent Supreme Court ruling; Bittner v. United States. 

The US had made a case against Romanian immigrant Alexandru Bittner, who, with 272 bank accounts, broke the law when he failed to file a relevant report with regulators for each one. 

US authorities demanded he pay a $10,000 Bank Secrecy Act fine for each, while the Supreme Court ruled he only had to meet a one-time payment of $10,000. 

“Bittner did not learn of this reporting obligation until returning to the United States many years later. After he returned, he filed the required reports, but not in time to avoid violations,” wrote law firm Faegre Drinker in a recent blog.

The Supreme Court sided with Bittner, saying that fair notice hadn’t been given, specifically to the point that it would demand individual fines for each undisclosed bank account. Ripple is similarly arguing that fair notice was not adequately provided. 

In this week’s filing, the SEC said that based on other, long standing Supreme Court precedents, namely those established in Upton v. SEC, which established the Howey Test, have given Ripple ample time to adhere to securities laws. 

Ripple’s legal team did not return Blockworks’ request for comment.

Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.

Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief.

Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on Google News.


upcoming event

MON - WED, MARCH 18 - 20, 2024

Digital Asset Summit (DAS) is returning March 2024. This year’s event will be held in our nation’s capital, where industry leaders, policymakers, and institutional experts will come together to discuss the latest developments and challenges in the ever-evolving world of cryptocurrency. […]

upcoming event

MON - WED, SEPT. 11 - 13, 2023

2022 was a meme.Skeptics danced, believers believed.Eventually, newcomers turned away, drained of liquidity and hope.Now, the tide is shifting and it’s time to rebuild. Permissionless II is the brainchild of Blockworks and Bankless. It’s not just a conference, but a call […]

recent research

Cosmos Hub: ATOM Economic Zone


Replicated Security, the Hub’s Validation-as-a-Service offering that went live in March, is the first step in bringing value accrual to ATOM stakers.



Bitcoin price predictions are meaningless, so let’s expend our prediction energy on something that actually matters


A new complaint against Elon Musk and Tesla alleges that Musk manipulated both bitcoin and dogecoin


Kenya’s central bank doesn’t seem enamored by the idea of a CBDC but hasn’t slammed the door shut yet


Both Ethereum and Solana have enjoyed vibrant DeFi environments, but this has not yet been the case for Cosmos


As Japan takes important step forward on stablecoins, industry participants say, proposed US laws around such crypto assets remain in flux


Stablecoins offer global financial access and on-chain transactions without limitations, while FedNow falls short in terms of utility, global reach and inclusivity