The prolonged legal battle between Ripple Labs and Exchange Commission (SEC) is gradually coming to an end after years of disputes. Recent developments indicate that the scales are tipping in Ripple’s favor, as the company continues to secure key advantages. This marks a significant turning point in the highly debated lawsuit within the crypto industry. Investors are now closely monitoring the case, awaiting the final verdict.
SEC partially refunds fine as Ripple withdraws appeal
The U.S. Securities and Exchange Commission (SEC) has decided to refund $75 million out of the $125 million fine that Ripple previously paid following a court ruling. However, the SEC will retain $50 million, and the agreement will only take effect after being approved by the commission’s vote. This announcement comes just a week after the SEC unexpectedly withdrew its appeal against part of Judge Analisa Torres’ ruling. The court had previously determined that Ripple did not violate securities laws when selling XRP on exchanges, although sales to institutional investors were deemed to be in violation of regulations.
As part of the new agreement, Ripple has agreed to withdraw its cross-appeal in an effort to end the prolonged legal dispute. According to Ripple’s Chief Legal Officer, Stuart Alderoty, the SEC will also submit a request to the court to lift the ban on Ripple selling XRP to institutional investors.
Following the announcement, XRP saw a slight increase of 1.5% before quickly correcting to around $2.45. The price movement mirrored the broader cryptocurrency market trend, with Bitcoin (BTC) also experiencing slight adjustments. This latest move by the SEC could mark a significant turning point in the prolonged legal battle between the regulator and Ripple, potentially paving the way for broader regulatory changes in the U.S. cryptocurrency market.
Legal developments between Ripple and the SEC: Impact and latest updates
The legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC) has lasted for more than three years, becoming one of the most significant lawsuits in the cryptocurrency industry. From the initial allegations to the latest updates, this case has had a major impact on Ripple, XRP, and the broader crypto market.
SEC lawsuit against Ripple: The beginning of a legal battle
In December 2020, the SEC filed a lawsuit against Ripple, alleging that XRP was an unregistered security and that Ripple violated securities laws by selling the token without regulatory approval. This was one of the biggest lawsuits ever filed by the SEC against a major cryptocurrency company, sparking debates over how digital assets should be regulated in the U.S.
Ripple immediately rejected the allegations, arguing that XRP was not a security but rather a digital currency, similar to Bitcoin and Ethereum. The company also criticized the SEC for its unclear regulatory approach, warning that the lawsuit could significantly impact the growth of the crypto industry.
Landmark ruling in 2023: XRP is not always a security
After more than two years of litigation, in July 2023, Judge Analisa Torres of the U.S. District Court for the Southern District of New York issued a pivotal ruling, categorizing Ripple’s XRP sales into two main types:
Programmatic Sales (Blind Auction Sales): Ripple sold XRP on exchanges through an auction process where buyers were unaware they were transacting with Ripple. The judge ruled that these transactions did not violate securities laws, as XRP in this context was not considered a security under legal definitions.
Direct Sales to Institutional Investors: When Ripple sold XRP directly to large institutional investors, these transactions were classified as investment contracts and thus fell under U.S. securities laws. As a result, Ripple was found to have violated securities regulations in these cases.
The $125 million fine and latest updates
Following this decision, in August 2024, Ripple was fined $125 million by the SEC for violations related to its institutional sales of XRP. However, according to the latest updates, the SEC has agreed to refund $75 million of this total fine while retaining $50 million. This agreement is still pending a vote by the SEC before it officially takes effect.
Ripple and U.S. politics: The impact of its legal battle with the SEC
Before the lawsuit, Ripple had little political involvement in the U.S. However, according to CEO Brad Garlinghouse, if the SEC had not been led by Chairman Gary Gensler, the company might not have been drawn so deeply into American politics. Although the lawsuit was originally filed under former SEC Chairman Jay Clayton, Gensler’s approach to the crypto industry has positioned Ripple as a key player in lobbying for cryptocurrency regulations.
During the 2024 U.S. presidential election, Ripple contributed $45 million to Fairshake, a political action committee (PAC) supporting crypto-friendly candidates. Additionally, the company pledged $5 million in XRP to Trump’s inaugural fund. However, Ripple’s Chief Legal Officer, Stuart Alderoty, emphasized that the SEC’s decision to withdraw from the lawsuit was not influenced by political donations.
Following the election on November 5, both Garlinghouse and Alderoty attended official inauguration events in Washington, D.C., as invited guests. Furthermore, on March 7, the Ripple CEO participated in the White House Crypto Summit, where Trump discussed stablecoins and the regulatory framework for the cryptocurrency industry.
These developments highlight Ripple’s growing influence on U.S. cryptocurrency policies, especially as the new administration takes a more open stance toward blockchain and digital assets. Stay tuned to Copy Trade Crypto Bot, the platform that consistently delivers the latest news and market analysis in crypto, to stay updated on Ripple and the evolving digital asset ecosystem.