XRP: Ripple Ends Legal Battle With SEC in $50M Deal

XRP holders and the wider crypto community welcomed a landmark update this week as Ripple Labs brought its long-standing legal dispute with the U.S. Securities and Exchange Commission (SEC) to a close through a $50 million settlement. The resolution marks a pivotal moment for XRP and a broader turning point in crypto regulation discussions.

The conclusion comes after nearly four years of contentious litigation that began in December 2020. Ripple had been accused by the SEC of raising over $1.3 billion via an unauthorized securities offering involving its XRP token. The recent court-submitted agreement, filed on May 8, formally ends this prolonged legal standoff and sets the path for both sides to withdraw their challenges.

Final Terms of the XRP Settlement

According to the joint court filing, Ripple has agreed to pay $50 million to the SEC — a considerable reduction from the previously imposed $125 million penalty. The balance of $75 million, tied up in an escrow account, is set to be returned to the company, contingent upon approval from New York Judge Analisa Torres.

The filing also includes a request to dissolve the existing injunction against Ripple and finalize the disbursal of escrowed funds. Both the SEC and Ripple have agreed to drop their respective appeals, signaling a complete cessation of litigation. The SEC will abandon its previously filed appeal, while Ripple will retract its cross-appeal.

This settlement also reflects broader changes within the regulatory landscape. Shifts in leadership at the SEC, including the departure of its prior Chair, provided a backdrop for the softened stance toward Ripple. Though speculation had already surfaced about the SEC ceasing its appeal, the final court document now makes that official.

A Legal Saga Neared Its End

The dispute originated in December 2020 when Ripple and executives Chris Larsen and Brad Garlinghouse were sued by the SEC for allegedly offering unregistered securities through XRP token sales. Ripple denied the allegations, leading to a courtroom tug-of-war over how digital assets should be classified under U.S. securities law.

A significant pivot occurred in July 2023 when Judge Torres ruled that XRP did not meet the criteria of a security when sold to retail investors. However, institutional sales were deemed securities offerings, opening the door to partial penalties that led to the $125 million fine issued in August 2024.

The SEC contested this split decision, filing an appeal in January 2025 that challenged how XRP transactions were categorized between institutions and retail buyers. Ripple promptly responded with a counter-appeal aimed at defending its partial legal win.

Now, with the appeals withdrawn and the fine negotiated, the legal journey nears its permanent resolution. Lawyer James K. Filan noted that Judge Torres must first issue an indicative ruling in favor of the outlined settlement before it is officially finalized. Following this, a joint request for brief remand from the Second Circuit Court of Appeals will enable the enforcement of the terms.

Looking Ahead for XRP and Ripple

Once all procedural steps are completed, Ripple will be freed from court-imposed restrictions, and the frozen funds will be made available to the company. The conclusion of the case has also been met with notable reactions in the market.

XRP’s valuation responded positively to the news, registering a 5.2% increase in the past 24 hours, although this is modest when compared to the broader crypto market’s weekly uptick of 7%. Nevertheless, XRP’s performance over the past year remains striking, with a 340% rise making it one of the space’s top-performing assets.

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

The announcement has sparked celebration among the XRP community, with legal advocates and longtime supporters of Ripple concluding that this development finally brings closure to one of crypto’s most closely watched legal sagas.