Ripple Labs and SEC Case Overview
In a significant ruling that further complicates the ongoing case concerning Ripple Labs and the SEC, U.S. District Judge Analisa Torres has dismissed a joint request from both parties to modify an existing settlement agreement related to the cryptocurrency XRP. This decision, rendered on May 15, rejected Ripple’s and the U.S. Securities and Exchange Commission’s plea to lift an injunction and diminish a $125 million civil penalty to $50 million, which was proposed during their appeal process.
Legal Proceedings and Ruling
The court found the motion improper, noting it should have been filed under Rule 60, which addresses requests for relief from final judgments under specific “exceptional circumstances.” Attorney James Filan, an observer of the proceedings, noted on social media platform X that the court indicated it would also deny relief even if jurisdiction were restored, labeling the motion as procedurally flawed.
Background of the Case
This legal battle began in 2020 when the SEC accused Ripple Labs of unlawfully selling XRP as unregistered securities, an allegation that has sparked considerable debate in the cryptocurrency community. A landmark ruling in 2023 provided some reprieve for Ripple, stating that specific XRP sales did not qualify as securities transactions. However, the final judgment in 2024 imposed a hefty $125 million penalty on Ripple, which the company is appealing.
Settlement Negotiations
As of May 8, 2025, Ripple and the SEC had negotiated a settlement that would eliminate the injunction against Ripple and adjust the civil penalty significantly. For this agreement to take effect, Judge Torres not only needed to approve the reduction but also had to lift the existing injunction. Filan emphasized that the case’s resolution hinges on the court’s signal to permit this change, which would lead both parties to dismiss their respective appeals and formally conclude the lengthy legal dispute over XRP.
Impact on Cryptocurrency Sector
This recent development has heightened scrutiny and concern within the cryptocurrency sector, as stakeholders await further decisions in a case that could set important precedents for the regulation of digital assets.
