Ripple and SEC File Joint Motion to Pause Appeals in XRP Lawsuit

A joint motion to pause appeals marks a key step in the Ripple-SEC legal saga, potentially clearing the path for XRP ETF approvals.

On April 10, 2025, the U.S. Securities and Exchange Commission (SEC) and Ripple reached a settlement agreement, jointly filing a motion to suspend the appeal process. This development marks a significant step towards concluding the high-profile legal dispute that began in 2020, capturing the attention of the crypto industry. Former U.S. federal prosecutor James K. Filan disclosed the news on the X platform, noting that the settlement is currently awaiting final approval from the SEC's commissioners. The legal briefs, initially due on April 16, have been canceled.

In December 2020, the SEC accused Ripple and its executives, Brad Garlinghouse and Chris Larsen, of illegally raising over $1.3 billion through the sale of XRP, allegedly violating securities laws. The SEC contended that XRP tokens were essentially unregistered securities, while Ripple maintained that XRP was a utility token used for cross-border payments and should not be subject to securities regulations.

On July 13, 2023, U.S. District Judge Analisa Torres of the Southern District of New York delivered a landmark ruling: XRP's programmatic sales on public exchanges did not constitute securities, but direct sales to institutional investors did. This decision was seen as a mixed outcome, with Ripple achieving a partial victory, yet the SEC continued to pursue remedies including fines up to $2 billion and injunctions.

In October 2024, the SEC filed an appeal against Judge Analisa Torres's decision, disputing her ruling that XRP sales to retail investors did not qualify as securities. In reaction to the SEC's appeal, Ripple opted to file a cross-appeal later that same month. The case is advanced to the Second Circuit Court of Appeals.

On March 25, 2025, Ripple and the SEC reached a preliminary settlement. According to disclosures at the time, Ripple agreed to pay a $50 million fine, significantly lower than the SEC's initial demand of $125 million, with the remaining funds to be returned to Ripple from escrow accounts. Additionally, the SEC agreed to request the court to lift the standard injunction against Ripple, allowing it to resume sales to institutional investors. This settlement still requires formal approval from the SEC's commissioners and the finalization of legal documents.

According to court documents shared by James K. Filan, the SEC and Ripple jointly filed a motion, with the Second Circuit Court of Appeals to hold the appeal proceedings in abeyance. The motion indicates that a settlement agreement has been reached and is pending final approval from the SEC's commissioners. Settlement-related documents are expected to be finalized within the next 60 days.

Following the settlement agreement, the price of XRP showed a moderate response. As of April 11, according to CoinMarketCap, XRP was priced at $1.99. Moreover, the SEC and Ripple's settlement could pave the way for potential approval of an XRP ETF in 2025. Companies like Grayscale, WisdomTree, and Bitwise have already submitted applications for an XRP ETF to the SEC. Currently, the well-known prediction platform Polymarket shows a 77% chance of an XRP ETF being approved within the year.