SEC vs. Ripple: A Four-Year Legal Battle Nears an End

The U.S. Securities and Exchange Commission (SEC) may be on the verge of concluding its long-running enforcement case against Ripple Labs after more than four years of legal disputes. 

Fox Business reporter Eleanor Terrett reported on March 12 that the case was “in the process of wrapping up” following appeal and cross-appeal filings related to an August 2024 $125-million court judgment. 

The lawsuit, originally filed in December 2020, accused Ripple and its executives of selling XRP as an unregistered security to raise funds.

Ripple’s Legal Team Remains Optimistic

Ripple’s chief legal officer (CLO), Stuart Alderoty, told on March 11 that the case was far ahead of other SEC crypto lawsuits that had been dropped since President Donald Trump’s inauguration and the departure of SEC Chair Gary Gensler. 

Since January, the SEC has already halted enforcement actions against major crypto firms like Coinbase, Consensys, and Kraken, signaling a change in approach under the new administration. 

However, Alderoty noted that because Ripple has already received a judgment and is now in the appeals process, resolving the case is more complex. 

“We do have a judgment, we are on appeal — that presents some additional complexity,” Alderoty stated. “But we remain optimistic that we’ll get to a resolution with the SEC, and if we don’t, we’ll proceed with the appeal.”

Possible Outcomes: What’s Next for Ripple?

According to Alderoty, there are several possible outcomes to closing the case: 

- If both parties agree to drop their appeal and cross-appeal, the $125-million judgment would remain final. 

- If there is a dispute over the monetary ruling, Ripple and the SEC would need to jointly request a modification from a judge. 

The SEC v. Ripple case was one of the first major court victories for the crypto industry, with Judge Analisa Torres ruling that XRP was not a security in programmatic sales on exchanges. 

As of now, no new filings suggest the SEC has formally moved to drop the case in either the U.S. District Court for the Southern District of New York or the U.S. Court of Appeals for the Second Circuit.

Changing SEC Stance Under Trump Administration 

Though the SEC initially filed the Ripple lawsuit under former Trump-appointed Chair Jay Clayton, enforcement actions ramped up significantly after Gensler took office in 2021. 

Ripple CEO Brad Garlinghouse previously stated that Ripple’s legal battle with the SEC pushed the company deeper into U.S. politics, leading it to contribute $45 million to the Fairshake political action committee in 2024, with an additional $25 million donation in November 2024. 

The company also pledged $5 million in XRP to Trump’s inauguration fund following his 2024 election victory, with both Garlinghouse and Alderoty attending official inauguration events in Washington, D.C., on January 20.

Political Influence? Critics Raise Questions

The timing of SEC enforcement cases being dropped after key political donations has fueled criticism of potential conflicts of interest in the Trump administration. 

- Coinbase, another major Fairshake donor that contributed $1 million to Trump’s inauguration fund, had its SEC lawsuit halted in February. 

- Coinbase CEO Brian Armstrong also attended the March 7 crypto summit at the White House, alongside Garlinghouse and other industry leaders. 

Alderoty dismissed claims that political contributions influenced SEC decisions, stating that the agency’s shift was instead a reflection of Acting SEC Chair Mark Uyeda’s stance on crypto regulation. 

Meanwhile, the nomination process for a new SEC chair remains pending. The U.S. Senate has not yet scheduled a hearing for Paul Atkins, Trump’s proposed pick for the role. Until a new chair takes office, regulatory clarity for crypto remains uncertain.