SEC Action Concludes With $75M Recovery for Ripple

Summary

• Ripple Labs and the SEC are nearing a final resolution to their long-standing legal battle, jointly seeking court approval for a modified $50 million settlement (down from $125 million), which would see $75 million returned to Ripple and the current injunction dissolved.

• This anticipated conclusion to the lawsuit, which began in 2020 over alleged unregistered XRP sales, positions Ripple for accelerated growth, evidenced by recent acquisitions and a potential intensification of its M&A strategy, bolstered by a perceived favorable regulatory shift.

• The outcome reinforces XRP’s standing as a commodity, significantly boosting optimism for the approval of spot XRP ETFs (with analysts raising chances to 85%) and has already triggered a substantial price surge for XRP as investors bet on a positive final ruling.

A significant development in the protracted legal dispute between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has emerged, as both parties have jointly petitioned the U.S. District Court for the Southern District of New York.

They are seeking judicial endorsement for a modified settlement agreement, proposing a $50 million payment from an initially discussed $125 million to terminate their extensive legal conflict and lift the prevailing injunction against Ripple.

This arrangement stipulates the return of the remaining $75 million to Ripple Labs, signaling the formal conclusion of one of the most closely watched and lengthy legal battles within the cryptocurrency sector, pending Judge Analisa Torres’s approval.

Ripple Poised for Expansion as Legal Hurdles Dissipate

This landmark case, initiated in December 2020 under the then-SEC Chair Gary Gensler, centered on accusations that Ripple conducted unregistered securities offerings through the sale of its XRP token.

Despite the extensive legal proceedings, Ripple appears to have maintained a robust financial position and is now strategically positioned for significant growth. The settlement materializes at a juncture where Ripple is seen to benefit from evolving regulatory perspectives under the current Trump administration.

Illustrating its growth ambitions, Ripple recently executed a major acquisition of prime brokerage firm Hidden Road for $1.2 billion.

Furthermore, reports indicated exploratory discussions with Circle, the entity behind USDC, concerning a potential $5 billion acquisition, although this particular proposal was ultimately declined.

With the lawsuit concluding and a substantial portion of the penalty funds being returned, Ripple is anticipated to intensify its acquisition activities both domestically within the U.S. and on the international stage.

Boost for XRP’s Commodity Status and ETF Approval Optimism

The resolution of this case is widely interpreted as strengthening the classification of XRP as a commodity rather than a security, a distinction that could substantially improve the likelihood of an XRP-based Exchange Traded Fund (ETF) receiving regulatory greenlight.

Senior ETF analysts at Bloomberg have significantly raised their probability estimate for the approval of five spot XRP ETFs—filed by entities including Grayscale, 21Shares, WisdomTree, Bitwise, Canary, and Franklin Templeton—to 85%.

This marked increase is attributed to anticipated changes in leadership at the SEC.

This forecast represents a notable upgrade from just over two months prior, when the likelihood of an XRP ETF approval in 2025 was pegged at 65%.

Echoing this sentiment, prediction markets on Polymarket now reflect a 77% probability of an XRP ETF approval by December 31st.

Strengthening Regulatory Ties and Lobbying Efforts

Ripple’s engagement with U.S. regulatory bodies also appears to be on a positive trajectory.

Notwithstanding recent unconfirmed reports suggesting President Trump might have been misled regarding an endorsement of XRP for a national crypto reserve, Ripple’s proactive lobbying initiatives with the current administration are well-documented and seemingly yielding favorable outcomes.

XRP Value Surges as Market Anticipates Favorable Outcome

Following the announcement of the joint request for a definitive ruling on the settlement, XRP, Ripple’s native cryptocurrency, experienced a notable surge in value, climbing over 10% in early Thursday trading.

At the time of reporting, XRP was trading at approximately $2.28, reflecting a 7% increase from the previous 24-hour period.

Although the price has undergone a minor correction since the initial news, the rally was sufficiently robust to push XRP beyond the $2.3 mark today.

Market analysts are now observing a key resistance level at $2.5, with some speculating on a potential breakout towards $3.

More optimistic, longer-term price projections, contingent on swift court approval of the settlement and stable macroeconomic conditions, have ranged as high as $7 to $20.

While the final judicial ruling is still awaited, the market’s reaction clearly indicates strong anticipation of a positive resolution.

Should the court ratify the joint proposal, XRP could be poised for a significant upward trajectory. This surge in XRP’s valuation reflects deep-seated market optimism, as investors and long-term holders interpret the settlement as the concluding phase of a regulatory struggle that has impacted the token since late 2020.

Also Read: SEC Dismisses Ripple Complaint After 4 Years Clearer Crypto Rules

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