Launched by tech company Ripple Labs, Ripple (XRP) is one of the most talked-about and celebrated projects in the crypto sphere, ranking fourth among all cryptocurrencies in terms of market capitalization. However, those who haven’t had the patience or the curiosity to track Ripple’s evolution over the years might not know that much of its existence has been marked and marred by a yearlong battle with the U.S. Securities and Exchange Commission (SEC).
Fortunately, with the legal turmoil finally in the rearview mirror, the company can now fully focus on its future development – and those who are interested in Ripple as an investment can start looking into the XRP price prediction to get insights into how the asset might fare in this new chapter that’s just begun. So, let’s take a look at how things unfolded so far and see what we can expect from this point on.
How it started
Before moving forward, it’s worth doing a quick recap of how it all started. The legal feud goes back to 2020 when the SEC, an independent federal agency whose purpose is to regulate the U.S. securities markets and protect investors, filed a lawsuit against Ripple. The reason for the complaint was tied to how Ripple managed its sale of XRP tokens. In 2013, the company raised approximately $1.3 billion to fund its operations by selling XRP to investors via private sales and partnerships. According to the SEC, this constituted an illegal initial coin offering (ICO) as the tokens represented securities but weren’t registered as such when they were sold to institutional investors, thus breaching federal securities laws.
Ripple denied the allegations, stating that XRP wasn’t created as a security, but as a digital currency, and they never held an ICO. The company repeatedly specified that they obtained their funding through venture capital and angel investments, and that they only sold very small amounts of XRP at the price established by the market, after the asset was officially launched.
The case went on for four long years, during which both parties presented their arguments in court, with Ripple winning a partial victory in 2023. District Judge Analisa Torres decided in Ripple’s favor, ruling that XRP was not a security when sold on public exchanges, but it did violate securities laws when sold to investors. This decision included an order for Ripple to pay a $125 million penalty for the illegal institutional sales it conducted.
How it ended
Despite Ripple’s partial win, the SEC showed no intention of backing down and even appealed the court’s verdict, citing misapplication of the Howey standard in determining XRP’s legal status. However, the administrative changes that followed, with Donald Trump elected as President and the subsequent departure of Chairman Gary Gensler from the Commission on January 20, signaled a shift in the SEC’s approach and potentially influenced the case’s final outcome.
The high-profile dispute started during Joe Biden’s term and was carried out under former SEC Chairman Gary Gensler, known for his crypto-critical position, being part of a broader effort to crack down on cryptocurrency through legal actions. Under Trump’s crypto-friendly administration, the Commission appeared to reassess its stance on the crypto industry. This meant taking a step back from enforcement actions, prioritizing collaboration and the development of a comprehensive regulatory framework for crypto instead.
As a result, the SEC decided to drop its appeal in March 2025, putting an end to the lengthy legal battle. Following negotiations, Ripple Labs agreed to pay a reduced fine – $50 million to the SEC and another $50 million to the U.S. government – settling the matter without admitting to any wrongdoing.
The end of the long-standing legal struggle with the SEC represents not only a victory for Ripple but also an important milestone for the entire crypto industry. This brings greater regulatory clarity regarding the classification of digital assets and might facilitate mainstream adoption of crypto. Had the result been in the SEC’s favor, it would have placed most crypto tokens in the securities category and forced them to comply with applicable regulations.
What comes after
Now that Ripple is free from the legal scrutiny and pressure that has kept it in place for the past four years, everyone is naturally wondering what might come next. Unsurprisingly, the news that the SEC dismissed its case against Ripple caused the XRP to soar, gaining over 13% immediately after the Ripple CEO, Brad Garlinghouse, made the announcement.
Garlinghouse also mentioned that negotiations on the payment that Ripple Labs has to make towards the SEC and the US government are still ongoing. Most importantly, the negotiating parties are taking into consideration the prospect of this payment being made in XRP, which indicates greater acceptance of crypto at the institutional level.
As for Ripple’s journey from here on out, the conclusion of the lawsuit opens the door to numerous opportunities for the company. Garlinghouse described this new era as being defined by the intersection of institutional capital with decentralized finance. A major move in this direction was the acquisition of multi-asset prime broker Hidden Road in a $1.25 billion deal, something that wouldn’t have been possible if the SEC hadn’t reversed course on its appeal.
The CEO denied any plans for a Ripple initial public offering (IPO) in 2025, explaining that this doesn’t represent a primary focus. For now, the list of priorities includes launching an XRP ETF and strengthening XRP’s position in the U.S. Digital Asset Stockpile established by executive order under President Donald Trump.
Final thoughts
Ripple’s legal tussle with the SEC was one of the most resounding and closely watched cases in crypto’s history, not only because of its length, but also due to its broader market implications. Many see the resolution of the lawsuit as a new beginning for Ripple and a step forward for the crypto sector, signaling a more favorable regulatory environment for cryptocurrencies.
