Ripple Supporters Triumphantly Mark a Historical Moment as SEC's Legal Battle Concludes
The long-running legal dispute between Ripple Labs Inc. and the Securities and Exchange Commission (SEC) is nearing a formal conclusion, with both parties having filed a joint motion to dismiss their appeals, pending court approval. The case, which has been one of the biggest in American financial history, has significant implications for the crypto industry.
Ripple will pay a $125 million settlement, significantly less than the SEC's original $2 billion fine demand. Under the settlement, Ripple agrees not to sell XRP to institutional investors without proper SEC reporting. The core legal ruling from 2023 by Judge Analisa Torres established that XRP is not a security when sold on public exchanges but is a security when sold to institutional investors. This nuanced outcome sets a significant regulatory precedent for digital assets in the U.S. by distinguishing different XRP sales contexts under securities law.
For the XRP Army community, this outcome is seen as a major victory that validates their long-held view that XRP is not broadly a security. They regard the resolution as a crucial turning point in U.S. crypto regulation and are optimistic about XRP’s future growth and adoption.
The SEC alleged that Ripple had participated in a $1.3 billion unregistered securities offering via the sale of XRP. However, the XRP Army, a community of Ripple supporters, believes they have emerged from the legal battle against the SEC bigger and stronger. This belief stems from a 2020 blog post from Ripple CEO Brad Garlinghouse, who stated that Ripple is not only on the right side of the law, but also on the right side of history.
The legal battle acted as a call to arms for the XRP Army, a pseudonymous group. John Deaton provided legal support on behalf of 75,000 XRP holders in the SEC lawsuit. The XRP Army plans to rally its troops and push XRP to great heights in the future. After almost five years of aiding Ripple's legal battle, the XRP Army is going to take a much-needed rest.
For the broader crypto industry, the case has provided much-needed clarity on how regulators may approach securities classification for digital assets, signaling a possible shift toward more precise enforcement rather than broad crackdowns. The SEC’s narrowed enforcement stance and the court’s partial non-security ruling ease longstanding regulatory uncertainty, which should boost investor confidence and innovation in crypto markets.
In summary, the Ripple-SEC case ends with a significant regulatory milestone and a positive signal for XRP and the crypto ecosystem, while maintaining some compliance constraints around institutional sales. The dismissal of appeals will leave the nuanced court ruling intact, providing a valuable regulatory precedent for digital assets in the U.S. and beyond.
References:
- SEC, Ripple reach settlement in $1.3 billion XRP lawsuit
- Ripple-SEC Settlement: What It Means for XRP and the Crypto Industry
- Ripple Settles SEC Lawsuit for $1.3 Billion, Avoiding Registration as Security
- Ripple-SEC Settlement: A Turning Point for Crypto Regulation
- Ripple-SEC Settlement: What It Means for XRP and the Crypto Market
- The court's ruling in the Ripple-SEC case has established that XRP is not considered a security on public exchanges, but it can be deemed a security during institutional sales, setting a significant regulatory precedent for cryptocurrency in the U.S.
- The XRP Army, a community of Ripple supporters, views the settlement outcome as a victory validating their belief that XRP is not a broadly securitized digital asset.
- The settled case between Ripple and the SEC provides clarity to the crypto industry regarding securities classification for digital assets, signaling a potential shift towards more precise enforcement rather than broad crackdowns.
