After nearly five years of courtroom drama, Ripple Labs has officially ended its legal standoff with the U.S. Securities and Exchange Commission (SEC), marking a pivotal moment for the crypto industry. The company announced it will withdraw its cross-appeal, effectively accepting the court’s original ruling and penalties, while the SEC is also expected to drop its own appeal. This move brings long-awaited closure to a case that has shaped the regulatory landscape for digital assets in the United States.
Background: A Case That Defined Crypto Regulation
The legal dispute began in December 2020, when the SEC accused Ripple of conducting unregistered securities sales through its XRP token. In a landmark decision in July 2023, the court ruled that while XRP sales on public exchanges did not constitute securities, institutional sales did fall under securities laws . Both Ripple and the SEC appealed aspects of this decision, seeking more favorable outcomes.
Failed Settlement and Final Outcome
Earlier this year, both parties attempted to settle. The SEC proposed reducing Ripple’s penalty from $125 million to $50 million and dissolving the permanent injunction against Ripple’s institutional sales. However, Judge Analisa Torres rejected the joint motion, stating that neither side had justified amending the final judgment. The judge emphasized that public judgments must serve the public interest and that parties cannot simply agree to override a court’s final decision .
With the court unwilling to modify its stance, Ripple opted to drop its cross-appeal and accept the original terms: a $125 million penalty and a permanent injunction on certain institutional sales. The SEC is expected to follow suit by withdrawing its own appeal, effectively ending the litigation .
What’s Next for Ripple and XRP?
The conclusion of this case means Ripple can now focus on its business without the overhang of ongoing litigation. Importantly, the legal status of XRP as a non-security for public trading remains intact, providing clarity for exchanges and investors . However, Ripple as a company remains subject to the court’s injunction and penalty, underscoring the importance of compliance in institutional crypto sales .
Despite the legal resolution, XRP’s price has not seen an immediate boost, trading at $2,11 following the announcement.
