SEC Drops Its Pursuit of Ripple Labs, Ending the Long-Running Legal Battle Over XRP

The United States Securities and Exchange Commission has decided to end its pursuit of Ripple. The regulatory agency is dropping its appeal in the long-running legal battle over XRP

The U.S. Securities and Exchange Commission has decided to drop its case against Ripple. The regulatory agency is no longer appealing its rulings in the long-running legal battle over XRP.

Confirming this development on Sunday, Ripple CEO Brad Garlinghouse shared a personal message on X, formerly known as Twitter.

"I'm finally able to announce that this case has ended. It's over," stated Garlinghouse in a video message.

This incredible journey began in December 2020 when the SEC filed suit against Ripple. The regulator accused the company of conducting an unregistered securities offering, amounting to $1.3 billion through sales of its XRP token.

The case started with the SEC charging Ripple with selling XRP to raise capital without registering its offerings with the agency.

However, in July, a federal judge ruled that sales of XRP on crypto exchanges were not securities transactions. But, crucially, the judge found that Ripple’s "institutional sales" of XRP did violate securities law.

The SEC had planned to appeal those rulings, but in a surprising turn, the agency has decided to drop the case entirely.

The development marks a complete reversal of the agency's position, which had planned to appeal parts of the court's decision in the case.

The SEC has not yet released an official statement confirming this case closure.

The case, which began in 2020, had a significant impact on XRP holders, who suffered heavy losses.

Garlinghouse noted that approximately $15 billion in market value was erased when the SEC first filed its lawsuit against Ripple.

"The SEC was the market manipulator," claimed Garlinghouse in his statement. He argued that the regulator's actions harmed investors rather than protecting them, which he described as contrary to the agency's mission.

This resolution also comes during a shift in the SEC's approach to cryptocurrency regulation.

Under Acting Chairman Mark Uyeda, the agency has withdrawn from more than ten other crypto enforcement cases, including those against major players like Coinbase, Unispay Labs, and Karcen.

"This was the first major shot fired in the 'war on crypto'," said Garlinghouse about the lawsuit. He suggested that the case was "doomed from the start" and part of a broader government effort to "pick winners" in the cryptocurrency space.

Former SEC Chair Mary Jo White publicly criticized the agency's decision to pursue the case. According to Garlinghouse, White stated that the SEC was "dead wrong" in its approach to Ripple and XRP.

During the legal proceedings, the SEC faced judicial criticism. Garlinghouse noted that the agency was sanctioned for discovery abuses, with the judge rebuking them for lacking "faithful allegiance to the law" in their handling of the case.

The outcome of this case has now established that "the digital asset XRP is not a security. That is now the law," stated Garlinghouse. This precedent could influence how regulators approach digital assets in the future.

In response to the case development, XRP's price showed a positive reaction, rising to $2.55. The crypto market has been closely following updates in the case, which has significant implications for the broader digital asset industry.

As the legal battle comes to an end, it opens up possibilities for broader crypto adoption and innovation in the American market.

"This is a fight Ripple never wanted, but one we knew we had to win. And today, emphatically, we have,"

Garlinghouse stated. He expressed gratitude to Ripple employees, the legal team led by Chief Legal Officer Stu Alderody, and the broader XRP community.

"It's time to make the United States the crypto capital of the world," concluded Garlinghouse, hinting at the company's aspirations for the future.