In a landmark decision, the SEC has decided to drop its appeal and XRP lawsuit against Ripple Labs, as announced by Ripple CEO Brad Garlinghouse.
This development brings an end to the 5-year legal battle that has significantly impacted the crypto industry and XRP.
SEC Vs Ripple Is Finally Over
The SEC originally filed the lawsuit in December 2020, accusing Ripple of conducting an unregistered securities offering worth $1.3 billion through XRP sales.
However, in July 2023, US District Judge Analisa Torres ruled that XRP’s programmatic sales to retail investors did not constitute securities transactions, dealing a major blow to the SEC’s case. While the ruling upheld that institutional sales of XRP violated securities laws, the agency had been pursuing further legal action against Ripple.
With the SEC’s decision to withdraw its appeal and drop the lawsuit, Ripple has secured a significant regulatory victory. This outcome is expected to set a precedent for how digital assets are classified in the US and could influence the SEC’s broader approach to crypto enforcement.
“This is it – the moment we’ve been waiting for. The SEC will drop its appeal – a resounding victory for Ripple, for crypto, every way you look at it,” Garlinghouse wrote on X (formerly Twitter).
The SEC had until April 16 to decide on its appeal, but the commission seems to be expediting its move away from crypto enforcement.
Notably, this decision was not surprising, as the SEC has been dropping multiple crypto lawsuits over the past month. So far, it has dropped legal action and investigations against Coinbase, Kraken, Robinhood, MetaMask, OpenSea, Uniswap, and more.
Overall, the Ripple lawsuit was one of the biggest enforcement actions the SEC took against crypto. It was this lawsuit that marked the commission and Gary Gensler as profound skeptics of the industry.
“In so many ways, this lawsuit was the first shot fired in the war against crypto. Today is a long overdue surrender by the SEC. The regulator went all-in on a victimless lawsuit and wiped out $15 billion in value from innocent XRP holders. The SEC was the market manipulator. We won against them on every critical legal point,” said Garlinghouse.
XRP Surges Nearly 15%
Market reaction has been swift, with XRP seeing an immediate price surge following the announcement. Industry leaders have also hailed the decision as a step toward clearer crypto regulation.
XRP’s daily trading volume is also up by 80% following the announcement. XRP ETF odds will also likely jump, as the SEC’s decision means that XRP could potentially be labeled as a commodity like Bitcoin and Ethereum.
As the case concludes, attention now shifts to how the SEC will navigate future crypto oversight and whether this signals a shift in its regulatory stance.
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