XRP News Today: Ripple Penalty Reduction Denied Judge Rejects Motion

The ongoing legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has reached a pivotal moment. On May 8, 2025, Judge Analisa Torres denied a joint motion from both parties seeking an indicative ruling to reduce Ripple’s $125 million penalty to $50 million and to release associated escrow funds. The court deemed the motion “procedurally improper,” effectively stalling the proposed settlement.

Despite this setback, Ripple’s Chief Legal Officer, Stuart Alderoty, emphasized that the company’s previous legal victories remain intact, notably the 2023 ruling that XRP is not a security when sold on public exchanges. This ruling is crucial as it sets a precedent for how cryptocurrencies can be classified and regulated.

A full Ripple win could set a significant legal precedent, allowing banks and institutions to adopt blockchain for core financial functions. According to a Crypto analyst, a Ripple win would be a milestone for blockchain-based infrastructure. It could give banks, investment funds, and corporations a working model for how to shift critical financial functions, like payments, settlements, and custody, to blockchain networks. If XRP is officially deemed not a security, it would validate the idea that tokens can represent future corporate value without falling under strict securities laws.

This could pave the way for other companies to raise capital and transfer value on-chain, avoiding the regulatory roadblocks that often slow innovation. The foundations of finance are already beginning to shift. Tokenized shares could settle instantly, custody could be handled by smart contracts, and payment systems could directly connect to crypto wallets. Institutions would still play a role, but they’d operate on more efficient, digital rails.

If the court backs Ripple’s structure, it would send a strong message: blockchain technology is ready to support core financial operations. This wouldn’t just help Ripple, it would signal that the industry is mature enough to support the next phase of global finance. The outcome of this lawsuit could reshape crypto regulation in the U.S., providing clarity on how digital assets should be treated under securities laws.