Ripple Labs Inc. is pushing back against a US$2 billion fine proposed by the U.S. Securities and Exchange Commission (SEC), advocating for a reduction by referencing Terraform Labs’ recent US$4.5 billion settlement as a comparative benchmark.

The blockchain firm’s legal team contends that the suggested penalty for their XRP sales is unduly harsh and should be closer to US$10 million, highlighting the lack of fraud allegations and minimal investor losses in their case, unlike Terraform’s.

This legal challenge follows a protracted battle with the SEC, which has accused Ripple of executing unregistered securities offerings.

In the Terraform Labs case, the SEC imposed a substantial settlement including a permanent ban for co-founder and former CEO Kwon Do-hyung from holding certain corporate positions.

The SEC’s lawsuit against Ripple, which began in December 2020 with allegations of the company raising US$1.3 billion through unregistered XRP sales, has been under intense scrutiny from the cryptocurrency sector due to its potential impact on digital asset classification and regulation.

Ripple scored a partial victory in the case where the judge ruled that the company’s public sale of XRP did not violate security rules while institutional sales did.