Ripple’s (XRP-USD) long legal fight with the SEC has ended. The company is walking away as one of the strongest defenders of crypto in court. Its victory is now pushing the SEC to focus on creating clearer rules for the industry.
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SEC Brings Ripple Case to a Close
Last week, Ripple Labs and the U.S. Securities and Exchange Commission agreed to end their nearly five-year dispute. Both sides dropped their appeals and will cover their own legal costs, according to a filing with the Second Circuit Appeals Court.
This shows a major change in how the SEC is approaching crypto oversight. Commissioner Hester Peirce called the resolution a “welcome development” because it frees up time and resources for writing clear crypto regulations. SEC Chair Paul Atkins agreed, saying the agency can now “shift our energy from the courtroom to the policy drafting table” to create rules that “foster innovation while protecting investors.”
The SEC first sued Ripple in December 2020. The agency claimed Ripple had raised $1.3 billion by selling XRP as unregistered securities. In July 2023, a federal judge ruled that XRP was not a security when sold to retail investors but was a security in sales to institutions. Ripple was fined $125 million in August 2024.
Lawmakers Push Ahead with Crypto Legislation
The end of the Ripple case comes as Congress moves forward with the Digital Asset Market Clarity Act, or CLARITY Act. The bill would set clearer definitions for how U.S. digital asset markets operate. Republican lawmakers and the Senate Banking Committee are aiming to pass it by September 30.
However, not everyone supports the plan. Top Democrats, including House Financial Services Committee ranking member Maxine Waters, have called the bill “dangerous.” She also criticized the Anti-CBDC Surveillance State Act, which would block a U.S. central bank digital currency. This shows how divided lawmakers remain on crypto policy.
What the Case Means for the SEC’s Next Steps
With the Ripple lawsuit over, the SEC now has the chance to put more focus on regulation instead of courtroom battles. For years, high-profile cases have taken up much of the agency’s attention.
The main question going forward is how the SEC will engage with the industry. Ripple’s win has encouraged other crypto companies to challenge the SEC. How the agency responds in the coming months will set the trajectory for the next chapter in U.S. crypto regulation.
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