Cryptocurrency XRP grew by 13% per day

Ripple Labs and the U.S. Securities and Exchange Commission (SEC) have officially ended a nearly four-year legal battle, one of the most high-profile cases in the history of cryptocurrencies. Following the news, the XRP token price XRP $2.82 XRP 0.40% Market capitalization $167.85 billion VOL. 24 hours $0.16 billion rose by more than 13%.

On Thursday, the parties filed a joint notice with the U.S. Court of Appeals for the Second Circuit on the voluntary withdrawal of their appeals. The SEC refused to appeal the 2023 decision, which found that the XRP token is not a security when sold on public exchanges. Ripple, in turn, withdrew its counter-appeal. Each party agreed to cover its own legal costs.

The case was initiated in 2020 under SEC Chairman Jay Clayton — the agency accused Ripple of raising funds through an unregistered offering of securities by selling XRP. The case was heard in the Southern District of New York and became a defining precedent for the valuation of digital tokens under US law.

In July 2023, federal judge Alice Torres issued a mixed decision: Ripple did indeed violate the law by selling XRP directly to institutional investors, but sales on exchanges to retail investors did not qualify as securities. This approach was a partial victory for the crypto industry.

The SEC appealed part of the decision on retail sales, while Ripple defended its position in full. Changes in the SEC after Donald Trump’s return to the presidency and the renewal of the leadership led to a revision of the regulator’s approaches: more than a dozen cryptocurrency-related cases were closed.

In June last year, the parties agreed on the terms of the penalty settlement. The court ordered Ripple to pay $ 125 million in fines and imposed a permanent ban on violations of securities laws in future institutional sales of XRP. This amount is held in an escrow account and will be transferred to the US Treasury after the appeals are closed.

Negotiations to reduce the fine failed, so the final withdrawal of the appeals cements the agreement reached and ends a long-running conflict. The upheld 2023 decision may become an important precedent for future judicial assessments of the status of crypto assets in the United States, and for Ripple, it allows it to expand its operations in countries with more transparent regulation.