The long-standing legal saga between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has come to a close, ushering in a new chapter for the cryptocurrency landscape. This resolution arrives as Ripple and the SEC, on Thursday, informed the Second Circuit Court of Appeals about their mutual decision to withdraw their respective appeals from a 2023 ruling. Each entity will shoulder its own expenses, marking an end to a contentious battle that has shaped discussions around cryptocurrency regulation since it began in 2020.
A Contentious Battle Ends
The conflict ignited in December 2020 when the SEC, led by then-Chair Jay Clayton, accused Ripple of breaching securities laws through its sale of XRP, Ripple’s closely linked digital token. This high-profile case has been under the spotlight for years, significantly influencing the discourse on how digital assets are classified and regulated in the United States.
In 2023, District Judge Analisa Torres ruled that Ripple breached securities laws when selling XRP to institutional investors, imposing $125 million in fines and enforcing a permanent injunction against further violations. However, the judge also determined that Ripple’s distribution of XRP via exchanges to retail investors did not constitute a securities offering—a partial victory for Ripple that the SEC challenged in 2024 with an appeal. Ripple, maintaining its stance, cross-appealed to defend its position.
Market Reactions and Ripple Effects
XRP’s market response was swift following the announcement, with the token’s price climbing 5% to approximately $3.27. This uptick reflects investor sentiment that the resolution may bring much-needed clarity and stability to Ripple’s operations and, by extension, the broader cryptocurrency market. However, market volatility remains a concern, as highlighted in Ripple’s XRP Tanks 8% in 24 Hours as Market Volatility Grips Traders.
“The dismissal of these appeals is a crucial stepping stone for Ripple and the entire crypto ecosystem,” remarked Alex Thompson, a crypto analyst at Digital Asset Research. “It suggests a potential softening stance from the SEC under new leadership, which could pave the way for more progressive regulatory frameworks.”
Indeed, since the onset of President Donald Trump’s recent administration and the subsequent reshuffling at the SEC, the regulatory body has ceased over a dozen investigations into crypto firms, hinting at a strategic pivot. This apparent shift in policy could foster a more conducive environment for innovation within the crypto sector, though the specifics remain to be seen.
Unfinished Business and Future Implications
Ripple’s attempts to negotiate a reduction of the penalties imposed by Judge Torres were thwarted, leaving the $125 million fine intact. This outcome underscores the complexities involved in the intersection of cryptocurrency and regulatory compliance. Ripple CEO Brad Garlinghouse previously expressed optimism about reaching a more favorable settlement, but these hopes were dashed by procedural hurdles.
Looking forward, the resolution of this case might set a precedent for how similar cases are approached, especially concerning the classification of digital assets. The crypto community is keenly observing whether this signifies a trend towards more lenient regulatory measures or if it merely represents an isolated incident. For further insights into Ripple’s stance on regulatory frameworks, see Ripple Criticizes Draft Crypto Market Structure Bill: Details.
Yet, as the dust settles, questions remain about the SEC’s future direction concerning cryptocurrency oversight. Will this resolution herald a new era of collaboration between regulators and crypto entities, or is it a transient respite in an ongoing regulatory storm? Only time will tell, but for now, Ripple and its supporters can breathe a sigh of relief as one of the most scrutinized legal battles in crypto history draws to a close.
Source
This article is based on: SEC’s Long-Running Case Against Ripple Officially Over
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
