Ripple Wins Legal Battle With SEC, $75 Million Fine Returned

In a pivotal development, Stuart Alderoty, the Chief Legal Officer of Ripple, announced via Twitter that the U.S. Securities and Exchange Commission (SEC) has agreed to drop its appeal without conditions. This decision comes after a prolonged legal battle that has spanned over four years. In response, Ripple has also withdrawn its cross-appeal, effectively concluding the legal dispute between the two parties.

As part of the settlement, the SEC will retain $50 million of the initially imposed $125 million fine, which had been held in an interest-bearing escrow account. The remaining $75 million will be returned to Ripple. Additionally, the SEC will request the Court to lift the standard injunction previously imposed at the agency’s request. These actions are pending the Commission’s vote, the drafting of final documents, and standard court procedures.

The legal dispute between Ripple and the SEC began in December 2020 when the SEC filed a lawsuit alleging that Ripple’s sales of its XRP token constituted unregistered securities offerings. In August 2024, U.S. District Judge Analisa Torres ruled that while Ripple’s XRP sales to institutional investors violated securities laws, sales to retail investors through exchanges did not meet the definition of securities. Consequently, Ripple was ordered to pay a $125 million fine, significantly less than the $2 billion sought by the SEC. The SEC had filed an appeal against this ruling, which has now been withdrawn as part of the settlement.

The resolution of this case is anticipated to have a substantial impact on the cryptocurrency industry, influencing how digital assets are classified and regulated in the United States. The outcome may also affect ongoing and future regulatory actions involving other cryptocurrency entities. Stuart Alderoty’s announcement marks the end of a significant chapter in Ripple’s history, concluding a legal battle that has spanned over four years. The settlement will bring clarity to Ripple (XRP) and may set a precedent for the broader cryptocurrency industry regarding regulatory compliance and the classification of digital assets.