XRP Gains Momentum After SEC Settlement Boosts Ripple

XRP has been front and center in the crypto world following a significant development in Ripple’s ongoing legal saga with the U.S. Securities and Exchange Commission (SEC). The regulatory body has officially resolved its four-year battle with Ripple, bringing relief and optimism to XRP investors.

Unlike traditional cryptocurrencies such as Bitcoin, which are mined through complex computational processes, XRP is directly issued by Ripple. This structure, while innovative, raised concerns about centralization and brought Ripple under SEC scrutiny beginning in 2020. The agency claimed XRP was effectively a security, not a currency, due to Ripple’s control and distribution model. At the heart of the case was whether XRP should be subject to securities regulations, similar to stocks or bonds.

In August 2024, a significant ruling differentiated XRP’s classification based on its method of sale. The court found that XRP could be treated as a security when sold to institutional investors, but not when utilized for general crypto transactions or traded on exchanges. While Ripple was fined $125 million, this outcome was widely seen as a partial victory, leading to both optimism and uncertainty among investors. The SEC’s appeal of the ruling further clouded XRP’s future — until now.

With the political landscape shifting, changes at the SEC followed. Paul Atkins, a crypto-friendly figure with a background in blockchain advocacy, was confirmed as the new SEC chair under the Trump administration. His appointment marked a broader shift in regulatory tone, with several enforcement actions against crypto giants like Binance and Coinbase either paused or dropped entirely. Naturally, the Ripple case was a high-profile candidate for a more lenient approach.

Negotiations ensued, and on May 8, 2025, the SEC agreed to reduce Ripple’s penalty from $125 million to $50 million and settled the matter in full. This new resolution removes a significant regulatory cloud hovering over Ripple and its flagship token, XRP.

Ripple’s value proposition lies in its ability to streamline international money transfers. Conventional banking systems often rely on intermediaries, which lead to delays and higher transaction costs. The Ripple Payments network offers a faster alternative, enabling nearly instant transactions across borders by allowing financial institutions to connect directly. XRP plays a critical role in this ecosystem by standardizing these transactions and keeping transfer fees extremely low — just 0.00001 XRP per transaction, often costing less than a cent.

XRP has a total supply of 100 billion tokens, with roughly 41.4 billion still retained by Ripple itself. This setup allows Ripple to distribute XRP strategically to meet market demand, yet it also fueled the SEC’s argument that such control amounted to centralized issuance, akin to issuing stock. With the legal risk now diffused, Ripple can focus again on expanding its network — but there are caveats for investors to consider.

Since last November, when former President Trump won re-election, XRP’s value has shot up by 370%. However, it remains below its 2018 peak and has dipped more than 25% from its most recent 52-week high. While regulatory clarity is a major win, it doesn’t guarantee continued gains. This is because the Ripple Payments network doesn’t require XRP to function; banks can still use fiat currencies within the platform. Consequently, XRP’s valuation continues to hinge more on investor speculation than practical demand alone.

Fiat currency remains a practical alternative in some cases, and until XRP achieves wider transactional adoption, its price movement may struggle to fully detach from market sentiment.

While the legal victory is certainly a milestone for Ripple and a relief for XRP holders, caution is still warranted. Regulatory risk may be fading, but speculators must remember that price momentum alone doesn’t equate to long-term utility-driven value. With institutional sentiment improving and the SEC no longer a looming threat, Ripple has a clearer runway ahead. Yet, tangible growth in real-world usage remains the key variable for XRP’s lasting success.

For investors watching this space, the message is clear: The road ahead for XRP is smoother, but the destination remains uncertain.

Related: Expert Advice: Sell XRP If You’re Confused