SEC Drops Appeal in Ripple Case, Ending Landmark Legal Battle Over XRP

Key Points

• The SEC has dropped its appeal in the lawsuit against Ripple Labs, following a 2023 ruling that classified XRP retail sales as non-securities.
• Ripple agreed to a $125 million penalty for institutional XRP sales, marking a partial victory in its legal battle.

Ripple Labs CEO Brad Garlinghouse announced that the U.S. Securities and Exchange Commission (SEC) will drop its appeal in the long-standing lawsuit over XRP’s classification.

This decision follows a pivotal 2023 court ruling that distinguished XRP sales to retail investors as non-securities, while institutional sales were deemed securities. As part of that ruling, Ripple agreed to pay a $125 million penalty for institutional XRP sales.

This is it – the moment we’ve been waiting for. The SEC will drop its appeal – a resounding victory for Ripple, for crypto, every way you look at it.

The future is bright. Let’s build. pic.twitter.com/7WsD0C92Cm

— Brad Garlinghouse (@bgarlinghouse) March 19, 2025

Background: SEC vs. Ripple

The SEC first filed its complaint against Ripple Labs in December 2020, accusing the company and its executives—Garlinghouse and co-founder Chris Larsen—of raising over $1.3 billion through unregistered XRP sales. The lawsuit became one of the most high-profile crypto legal battles, with industry players closely monitoring its outcome.

In July 2023, Judge Analisa Torres ruled that:

• XRP sales to retail investors via exchanges did not constitute securities offerings.
• Institutional XRP sales were classified as securities, leading to Ripple’s $125 million fine.

The decision was seen as a partial victory for Ripple, providing some regulatory clarity for the broader crypto market.

Why the SEC Dropped the Appeal

The SEC’s decision to abandon its appeal comes amid:

• A changing regulatory landscape, particularly under a pro-crypto Trump administration.
• Evolving attitudes among banking and financial regulators toward digital assets.
• A string of legal setbacks for the SEC in crypto-related cases, including its loss against Grayscale over Bitcoin ETF approval.

By dropping the appeal, the SEC avoids further legal battles that could set broader precedents limiting its regulatory power over cryptocurrencies.