Ripple Labs ultimately resolved its civil case against the U.S. Securities and Exchange Commission (SEC) in a settlement to pay a reduced fine of $50 million. The settlement brings an end to one of the most well-known cases in the crypto space. In the opinion of Ripple’s Chief Legal Officer, Stuart Alderoty, the action is necessary as it is sure to relax the SEC’s grip on the cryptocurrency space.
Ripple Labs Settles SEC Lawsuit: Details
A court, in August 2023, ordered Ripple Labs to pay $125 million for the sale of unregistered securities. Ripple is allowed to keep $75 million of the amount in the new deal. The other $50 million will be kept by the SEC in an interest-bearing escrow, according to a report released by Claims Journal.
The settlement is subject to court and SEC approval. Specifically, Ripple says that there is no wrongdoing admission in the case. Alderoty said the SEC also dropped its appeal of a previous ruling against Ripple’s XRP tokens, which is a more positive sign from the regulatory side for Ripple and potential shifts in the market.
XRP’s Market Response
While the settlement was a legal victory, the XRP price has been rather underwhelming. On Coingecko, the price is well south of the $2.50 mark. XRP has been downright flat between important support levels of $2.24 to $2.30, experts can attest.
Josh, a market analyst at Crypto World, pointed out that XRP is facing short-term resistance around $2.56. The fact that there is no visible bounce higher following the settlement indicates that investors are cautious because XRP has not yet experienced a genuine rally for the settlement of the lawsuit.
Broader Implications for Cryptocurrency Regulation
The ruling in Ripple Labs’ case against the SEC can be the beginning of a new way of doing things when it comes to how the U.S. is indeed going to regulate cryptocurrencies. Since President Donald Trump’s White House return, the SEC has already dismissed civil charges against major crypto exchanges like Coinbase and Kraken.
The nomination of Paul Atkins, a lawyer seen as supportive of the crypto industry, to chair the SEC may further influence the regulatory landscape. While the SEC rebuilds its hegemony, Ripple Labs’ settlement will be the paradigmatic case that decides what cryptocurrencies are and will regulate in the future.
With the reduced fine of $50 million, Ripple weathered a treacherous regulatory environment and is looking to a potentially more unfettered future. While XRP’s market response still lags, market observers will be mindful to see how these events play into the broader universe of cryptocurrencies.
