As Disruption Banking reported yesterday, the U.S. Securities and Exchange Commission (SEC) is officially dropping its appeal in a long-standing legal battle against Ripple. This decision, confirmed by Ripple CEO Brad Garlinghouse, represents a decisive victory not only for Ripple, but for the entire crypto community.
But, in spite of the progressive outcome for crypto firms, some questions remain. What does this mean for XRP in 2025? And will this latest development actually bring clarity to crypto regulations? Lets find out.
The Ripple-SEC saga
In December 2020, the SEC filed a lawsuit in which Ripple were accused of raising more than $1.3 billion through unregistered sales of XRP. It was a landmark moment for crypto regulations. The SEC’s classification of the cryptocurrency as a security was contentious from the start. Many in the industry argued that it would set a dangerous precedent for the broader market, and in the years since, the case has spiraled into one of the most high-profile legal battles in the sector.
Some, at first, considered the SEC’s approach a sign of its determination to take a hardline stance against cryptocurrencies. But in recent months, the landscape has shifted. As the case dragged on, Ripple made significant legal headway and the tide started to turn.
In a key ruling last August, Judge Analisa Torres of the Southern District of New York ruled that while XRP sales to institutional investors violated U.S. securities laws, XRP was not a security when sold on secondary markets. This decision, which essentially split the case in two, marked a significant partial victory for Ripple and cast doubt on the SEC’s aggressive approach. The ruling led to a huge penalty of $125 million for Ripple in 2024, far less than the $2 billion that the SEC had originally sought.
SEC drops its Appeal under acting Chair Mark T. Uyeda’s leadership
After more than four years of legal proceedings, Ripple’s CEO Brad Garlinghouse announced this week that the SEC will drop its appeal in the case. Garlinghouse celebrated the move as a “resounding victory,” not just for Ripple but for the entire sector. The industry, he said, could now focus on building and innovating, rather than being stuck in drawn-out legal battles.
The post, which included a video of Garlinghouse speaking, has garnered nearly 10 million views since, underscoring the importance of this moment for Ripple and the broader crypto ecosystem.
The SEC’s decision to drop the appeal is part of a broader shift within the agency itself. Under the leadership of Acting Chairman Mark Uyeda, the SEC has retreated from over 10 crypto enforcement cases, including those against major players such as Coinbase, Kraken, and Uniswap Labs. This indicates a shift in wihch the SEC are moving away from aggressive litigation and towards more constructive, rule-making efforts.
Chris Giancarlo, former CFTC Chairman, Ripple’s Chief Legal Officer Stuart Alderoty, who doubles as the President of the National Crypto Association, Jeremy Hogan, Partner at Hogan and Hogan, and Dave Portnoy, founder of Barstool Sports, are few names that have shared their excitement and congratulations for Ripple’s big break.
What does this mean for XRP’s legal status and future?
Despite this development, Judge Torres’ August ruling remains intact, but Ripple now holds the key to its next steps. While the SEC has agreed to drop its appeal on programmatic sales, Ripple still contests the $125 million fine and institutional sales injunction. Whether Ripple continues its appeal or seeks a settlement remains uncertain, but it’s clear that the SEC, after years of litigation, is no longer actively pursuing charges — pending final Commission approval of its appeal withdrawal. The Commission’s vote and approval is expected in several weeks.
Notwithstanding, Ripple’s legal victory could pave the way for XRP’s reclassification as a commodity, similar to other major cryptocurrencies like Ethereum. The case’s resolution offers the possibility of XRP being treated under a different regulatory framework (say from the SEC to the CFTC), one that aligns more closely with how commodities like gold and oil are regulated. If XRP is officially recognized as a commodity, it could lead to less stringent oversight and open the door for wider institutional adoption.
A case in point is the crypto derivative exchange, Bitnomial, which is set to launch the first CFTC-regulated XRP futures product in the U.S., scheduled to begin trading on March 20. This launch coincides with Bitnomial’s decision to drop its lawsuit against the SEC. This move signals an increase in regulatory clarity for XRP. This futures product is physically settled, meaning actual XRP will be delivered at contract expiration.
This legal clarity could set an important precedent for other cryptocurrencies facing similar regulatory scrutiny. As the SEC moves toward a more balanced regulatory approach, it could influence how other tokens are classified, but more importantly, regulated in the future. The resolution of Ripple’s case is likely to be seen as a precedent for others.
Combined impact on crypto legislation
Will XRP finally hit $10 in 2025? The recent developments in early 2025 mark a pivotal moment for US crypto legislation. The SEC’s decision to drop its appeal against Ripple provides an obvious precedent that XRP, when sold on secondary markets, is not a security. This clarity is crucial for the crypto industry, other digital assets will be able to lean on this precedent.
Complementing this, Disruption Banking covered President Trump’s announcement of a strategic crypto reserve that includes XRP signals strong government endorsement of digital assets. This move boosted market confidence, as evidenced by XRP’s small price correction and its rise to the third-largest cryptocurrency by market cap (CoinMarketCap).
In the meantime, the GENIUS Act, aims to establish a federal regulatory framework for stablecoins. With bipartisan support and recent approval by the Senate Banking Committee, the Act could significantly enhance the legal framework for crypto. It could lead to greater adoption and integration with traditional finance.
Together, developments like the resolution of Ripple’s SEC case, the strategic crypto reserve, and the GENIUS Act, can create a supportive regulatory environment. One that encourages innovation and adoption in the crypto space. However, challenges remain, cryptocurrencies are not simple and addressing fraudulent activity remains a priority for the community.
How did the market take the news?
The ripple effect of yesterday’s news was momentous. Following the announcement by Garlinghouse, XRP’s price increased by as much as 14%, briefly reaching $2.55, according to CoinMarketCap data. XRP almost instantly became the third-largest cryptocurrency by market capitalization, surpassing USDT. The increase in XRP’s value reflects broader market optimism, albeit perhaps not yet a rebound for all cryptocurrencies.
The decision to end the legal battle also marks a victory for XRP holders, who, according to Garlinghouse, lost an estimated $15 billion in value during the case. Garlinghouse has been vocal in his criticism of the SEC, which he accused of using enforcement actions, including lawfare, as a de facto regulatory tool, causing unnecessary losses for investors.
A New Chapter for Ripple and Crypto?
Everybody at Ripple is celebrating today. In the meantime, the broader cryptocurrency industry finds itself on the cusp of a new era. For Ripple, long term growth is back on the agenda. The company can focus on scaling XRP and expanding its utility in the cross-border payments space, by taking on SWIFT.
For the crypto industry at large, this case marks a landmark in the quest for regulatory certainty and legitimacy. The future of digital assets looks brighter than ever. Let’s hope the markets mirror this optimism soon.
Author: Richardson Chinonyerem
#Ripple #SECLawsuit #XRP #Crypto#CryptoRegulation #Cryptocurrency #Blockchain #Ripple #SEC #DigitalAssets #CryptoNews
The editorial team at #DisruptionBanking has taken all precautions to ensure that no persons or organizations have been adversely affected or offered any sort of financial advice in this article. This article is most definitely not financial advice.
See Also:
The SEC Drops Its Appeal Against Ripple | Disruption Banking
Is Ripple (XRP) About To Start A Bull Run? | Disruption Banking
