Ripple and the SEC Mutually Agree to Drop Appeals in Their Legal Battle
The long-running legal battle between the U.S. Securities and Exchange Commission (SEC) and Ripple Labs Inc. has officially concluded, marking a significant moment in U.S. crypto regulation [1][3][5]. In early August 2025, both parties jointly dropped their appeals, allowing a 2023 federal court ruling to stand as the final decision.
The ruling by Judge Analisa Torres found that XRP sales to retail investors on public exchanges did not constitute unregistered securities sales, while sales to institutional investors did violate securities laws [1][2][3][4]. As a result, Ripple was ordered to pay a $125 million fine for those institutional sales violations, a figure much lower than the $2 billion originally sought by the SEC [1][2][3][4].
This outcome effectively provides Ripple a partial legal victory by affirming that XRP is not a security when sold on public secondary markets, but also confirms some regulatory liability regarding institutional sales [1][3]. The resolution sets a legal precedent potentially clarifying how XRP and possibly other cryptocurrencies will be classified under U.S. securities law moving forward [3].
The end of the lawsuit removes years of uncertainty and litigation risk surrounding XRP, allowing Ripple to focus more confidently on its business [1][4][5]. SEC Commissioner Hester Peirce ("Crypto Mom") welcomed the development, noting that SEC resources can now shift from litigation toward crafting clearer crypto regulations, potentially benefiting overall regulatory clarity in the digital asset space [2].
- Final ruling: XRP is not a security when sold on public exchanges but was an unregistered security when sold to institutions.
- Penalty: Ripple to pay $125 million fines.
- Impact on XRP: Regulatory clarity, positive market reaction (XRP price rallied after announcement).
- Industry impact: Sets legal precedent for crypto regulation; SEC expected to prioritize clearer crypto rules post-litigation.
The case involved individual defendants Bradley Garlinghouse and Christian A. Larsen, and the dismissal filing is in Case No. 24-2648(L) and 24-2705(XAP). Each party will bear its own legal costs and fees. The case was on appeal following a final order from the U.S. District Court for the Southern District of New York (No. 20-cv-10832).
The conclusion of this lawsuit may have implications for the crypto industry, especially as lawmakers debate crypto regulation frameworks. The resolution could influence how other tokens and issuers are treated under securities laws going forward [1][2][3][4][5].
- The conclusion of the legal battle between Ripple Labs Inc. and the U.S. Securities and Exchange Commission (SEC) has established XRP as a non-security when sold on public exchanges, but an unregistered security when sold to institutions, a ruling that sets a legal precedent for crypto regulation.
- As a result of the lawsuit, Ripple was ordered to pay a $125 million fine for violating securities laws in sales to institutional investors.
- The resolution of this case has implications for the crypto industry, as it provides clarity for XRP and potentially other cryptocurrencies under U.S. securities law, and may influence how other tokens and issuers are treated moving forward.
