SEC Drops XRP Appeal, Ripple Wins Legal Battle

Ripple CEO Brad Garlinghouse announced that the U.S. Securities and Exchange Commission (SEC) will drop its appeal in the long-running legal battle over XRP. This development marks a significant victory for Ripple and the broader cryptocurrency community. Garlinghouse, in a post on X, described the decision as a "resounding victory for Ripple, for crypto, every way you look at it." The SEC's lawsuit, which began in 2020, has been a contentious issue, with the regulatory body alleging that XRP constitutes an unregistered security.

The SEC's decision to drop its appeal comes after a series of legal developments and regulatory shifts. In July 2023, U.S. District Judge Analisa Torres ruled that XRP is not a security when sold on secondary markets, though institutional sales violated securities laws, resulting in a $125 million fine for Ripple. The SEC appealed this decision in October 2024, but under new leadership—following Gary Gensler’s resignation and departure in January 2025 and Mark Uyeda’s appointment as acting chair—the agency’s stance appears to be softening.

The potential implications of this decision are far-reaching. If the SEC reclassifies XRP as a commodity, it could pave the way for spot XRP ETF approvals and drive XRP’s price toward higher levels. This move would align with the SEC's treatment of Ethereum (ETH), which is considered a commodity despite its initial coin offering (ICO). However, it is important to note that Ethereum is far more decentralized compared to XRP, which is not sufficiently decentralized when compared to the much larger Bitcoin (BTC) and Ethereum networks.

The resolution of this case could mark a turning point for broader crypto regulation in the U.S. Ripple's cross-border payment solutions have gained traction globally, and institutional adoption is rising. The executive team at Ripple Labs has shown resilience, having spent significant resources on legal fees over the years. With the legal battle nearing its end, Ripple is now focused on making meaningful contributions to the web3 space.

The crypto community anticipates announcements that could redefine XRP’s role in the digital assets landscape. If the SEC designates XRP a commodity, industry professionals anticipate a formal statement by mid-year, possibly alongside ETF approvals. This development could drive XRP’s price toward higher levels, according to crypto analysts. However, if negotiations falter, the appeal could extend into 2026, prolonging uncertainty. For now, all eyes remain on the SEC’s next move and the potential impact on the broader cryptocurrency market.