Ripple Labs vs. SEC: Legal Showdown Nears Resolution

The long-running legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) may be approaching a resolution, according to Fox Business sources.

Background

The case, ongoing since December 2020, began when the SEC accused Ripple of raising over $1.3 billion through unregistered sales of its XRP token. Recent discussions indicate that final terms are being considered.

Current Developments

Ripple’s legal team is seeking to renegotiate aspects of a critical 2023 ruling by District Judge Analisa Torres of the Southern District of New York (SDNY). This ruling imposed a $125 million penalty for Ripple’s institutional XRP sales, labeling them as unregistered securities offerings. However, it excluded Ripple from a nearly $2 billion fine that the SEC initially demanded. Shortly after, the SEC appealed Torres’ ruling, coinciding with former Chair Gary Gensler’s departure.

Despite the initial positive outcome for Ripple—given that the court ruled its sales to exchanges for retail traders did not count as securities—recent developments in the SEC under new leadership have changed the landscape. The SEC has curtailed numerous investigations involving crypto firms and has dropped cases against companies like Coinbase, Cumberland DRW, and Kraken. This shift may diminish the significance of Ripple’s partial victory.

Consequently, XRP’s value rose by 3% following the news. A representative from Ripple did not respond to CoinDesk’s request for comment by the publication deadline.

Read more: Ripple Plans ‘Cross-Appeal’ in SEC Case