XRP News Today: Ripple-SEC Settlement Delayed as Judge Rejects Penalty Reduction

Judge Analisa Torres has rejected a joint motion filed by Ripple Labs and the U.S. Securities and Exchange Commission (SEC) to reduce Ripple’s penalty and settle their long-running legal conflict. The ruling, issued on May 15, 2025, cited procedural grounds, stating that the motion lacked “exceptional circumstances” as required by Federal Rule of Civil Procedure 60. The parties had sought an indicative ruling to vacate a prior injunction and reduce the civil penalty from $125 million to $50 million, a 60% cut. However, Judge Torres maintained that even if the case were remanded to her jurisdiction, the motion would still be denied for failing to follow proper procedure.

This decision has delayed what many had expected to be the final phase of a lawsuit that began in December 2020. The SEC had accused Ripple of selling unregistered securities worth $1.3 billion through XRP. Despite this setback, Ripple’s Chief Legal Officer, Stuart Alderoty, emphasized that the ruling does not undo prior court victories, including the major win from July 2023, where Judge Torres clarified that XRP itself is not a security when sold to retail investors. Alderoty stated that this is about procedural concerns and that Ripple and the SEC remain aligned on resolving the case. The court blocked the procedural path, not the agreement itself, meaning Ripple and the SEC may revisit the matter using a more appropriate filing route.

The legal uncertainty briefly rattled XRP markets. After surging over 23% between May 8 and May 14—peaking above $2.60—XRP dropped to $2.43 following the judge’s decision. The rejection sparked volatility, with some traders concerned that further delays could lead to continued regulatory overhang. While the market reaction was swift, analysts argue the pullback may be temporary. “This ruling doesn’t materially change the legal landscape for XRP. It’s more of a process hiccup than a fundamental reversal,” said crypto legal analyst Katherine Wu.

The denial of the indicative ruling puts the ball back in the court of Ripple and the SEC to restructure their filing or pursue a different procedural route. Both parties remain publicly committed to finalizing the settlement. However, timelines may now stretch further into Q3 2025, adding uncertainty for investors and delaying long-awaited clarity on enforcement precedent. The case continues to symbolize broader tensions between the crypto industry and U.S. regulators. While Ripple scored a major victory in July 2023 that differentiated retail and institutional sales, the SEC’s reluctance to drop the case—and the court’s strict adherence to procedural formalities—highlight the lack of clear frameworks for crypto settlements. For now, XRP holders and the broader crypto market are left in limbo. The deal may not be dead, but it’s certainly delayed—and in crypto, time is money.