XRP investors can breathe a sigh of relief as the prolonged legal dispute between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has concluded. The U.S. Second Circuit Court has officially dismissed both Ripple’s cross-appeal and the SEC’s appeal, bringing a definitive close to a case that began nearly five years ago.

Final Court Decision Marks End of Legal Battle

According to a court document shared by legal expert James K. Filan, the appellate court accepted a mutual agreement from Ripple and the SEC to withdraw their respective appeals. This agreement, endorsed by Clerk Catherine O’Hagan Wolfe, was officially recorded with a simple but binding “So Ordered.”

This formal approval by the court confirms that both sides have agreed to terminate any further pursuit of appeals. The decision effectively seals the lid on one of the most high-profile legal cases in the crypto industry’s history.

Final ruling issued by the Second Circuit Court officially ends Ripple vs. SEC appeals.

Background of the Ripple vs. SEC Case

The saga began in December 2020 when the SEC filed a lawsuit against Ripple, accusing the company of conducting unregistered securities offerings through institutional XRP sales. Over the course of the case, Judge Analisa Torres ruled that XRP is not a security, particularly when sold on digital exchanges or distributed in programmatic sales.

However, the court still found Ripple liable for its institutional sales, leading to a $125 million penalty and a permanent injunction barring the company from similar sales without SEC registration. In October 2024, the SEC filed an appeal contesting the favorable rulings for Ripple, while Ripple filed a cross-appeal to challenge the punitive measures and institutional sales ruling.

With the arrival of a more crypto-friendly administration in early 2025, both parties sought resolution. They proposed to withdraw all appeals and agreed to reduce Ripple’s fine to $50 million by dissolving the court’s injunction. However, Judge Torres declined that joint request, which led both entities to formally withdraw their appeals instead. The Second Circuit granted that stipulation, finalizing the outcome.

Implications for Ripple and XRP

Following the dismissal of the appeals, the initial rulings by the lower court now stand unchanged. The $125 million in penalties that Ripple’s legal team had kept in escrow will now be released to the SEC. Ripple, for its part, is prohibited from engaging in unregistered institutional sales. The fintech firm has committed to registering any future XRP sales with the SEC to ensure full compliance with federal securities laws.

For XRP holders, the conclusion of the lawsuit removes a significant overhang. Investors had long anticipated regulatory certainty around the token. As the dust settles, XRP has responded positively. It’s experiencing a market rally, jumping 5.82% in the past 24 hours. The digital asset currently trades at $3.03, with a total market capitalization of $180.29 billion.

Looking Ahead: A New Chapter for XRP

Now that legal uncertainties regarding XRP have been resolved, market participants are likely to turn their attention to the token’s utility and broader adoption. With the regulatory dark cloud lifting, Ripple can resume its focus on global payments and enterprise blockchain expansion.

Related: XRP Price: $12M Max Pain for Bears

This closure also sets a precedent, providing a valuable reference for how digital assets are classified under U.S. securities law. It may pave the way for regulatory clarity in future crypto-related cases and help guide companies navigating blockchain compliance.