XRP Surges Over 3% Following Ripple’s Decision to Drop SEC Cross-Appeal
On Friday, the price of XRP, the cryptocurrency linked to Ripple Labs, experienced a sharp 3.36% increase, climbing to $2.18 shortly after Ripple CEO Brad Garlinghouse announced the company’s move to drop its cross-appeal in the ongoing lawsuit with the U.S. Securities and Exchange Commission (SEC). This legal battle, which has spanned more than four years since its inception in December 2020, has been a significant cloud over Ripple and XRP.
Ripple Signals the End of Legal Disputes with the SEC
In a post shared on the social media platform X, Garlinghouse stated, “Ripple is dropping our cross-appeal, and the SEC is expected to drop their appeal, as they’ve previously said.” He further emphasized the company’s intent to focus on growth and innovation, noting, “We’re closing this chapter once and for all and focusing on what’s most important – building the internet of Value.”
The announcement has been welcomed by the market, as evidenced by the immediate uptick in XRP’s market performance. Despite this recent bullish movement, XRP is still down approximately 4.44% over the last 30 days, according to data from CoinMarketCap.
Background of the Legal Dispute and Latest Developments
The lawsuit filed by the SEC in December 2020 accused Ripple Labs, along with executives Chris Larsen and Brad Garlinghouse, of illegally raising $1.3 billion by selling XRP as an unregistered security. The SEC has maintained that XRP sales violated federal securities laws, a claim Ripple has consistently disputed.
Just a day prior to Garlinghouse’s announcement, a U.S. district court denied a joint motion made by Ripple and the SEC. The motion sought an indicative ruling to reduce a $125 million civil penalty imposed on Ripple and requested a reversal of an order that classified certain XRP sales to institutional investors as securities transactions under Article 5 of the Securities Act. The court partially granted the SEC’s request for an injunction and penalty, highlighting concerns about Ripple’s practices.
Judge Analisa Torres remarked that Ripple’s actions suggested a likelihood of crossing legal boundaries established in earlier rulings, which influenced the court’s decision to enforce penalties. Following the ruling, Ripple’s chief legal officer, Stuart Alderoty, stated that “the ball is back in our court,” outlining the company’s choice to either continue appealing or accept the court’s findings. Alderoty reassured the community that XRP’s legal status “remains unchanged” as not being classified as a security and that business operations would continue uninterrupted.
Potential Resolution and Market Implications
If the SEC follows Ripple’s lead and also drops its appeal, the lawsuit would effectively draw to a close, removing a major source of uncertainty that has affected XRP’s adoption and price trajectory. Garlinghouse characterized the $125 million penalty as “a victory” compared to the SEC’s initial demand of $2 billion, marking a significant reduction and a partial win for Ripple.
Ending the lawsuit would allow Ripple to fully concentrate on expanding its blockchain solutions and ecosystem, focusing on its vision of creating the “internet of Value.” For investors and the broader crypto market, the resolution could restore confidence and pave the way for increased regulatory clarity.
Looking Ahead
The Ripple-SEC case has been watched closely as it represents one of the most high-profile regulatory challenges facing the crypto industry in the United States. A conclusion to this dispute would have impactful implications not only for Ripple and XRP but also for how digital assets are classified under U.S. securities law going forward.
As Ripples moves to close this chapter, market participants will be observing the SEC’s response and whether the regulator will indeed drop its appeal as anticipated. Meanwhile, XRP’s recent price bump reflects cautious optimism amid what could be a transformative moment for the asset and its community.
For further updates on Ripple, XRP, and the evolving crypto regulatory landscape, stay tuned to reliable sources like Cointelegraph.