In brief
- SEC and Ripple have filed a joint motion to dissolve the injunction and release escrowed funds.
- The latest proposal would see $50M paid to the SEC and the remainder returned to Ripple.
- The two are trying to wind down a case that began in 2020, centered on XRP sales as alleged unregistered securities.
The Securities and Exchange Commission and Ripple Labs have jointly asked a Manhattan federal court to dissolve a prior injunction and release $125 million currently held in escrow, according to a filing made Thursday in the Southern District of New York.
Under the proposal, Ripple would pay a $50 million civil penalty to the SEC, with the remaining funds to be returned to the company. The filing marks a major step in ending a case that has stretched nearly four years and triggered wide industry scrutiny.
Ripple directed Decrypt to court documents when requested for comment.
The joint motion follows earlier efforts by both parties to suspend ongoing appeals and reach a negotiated resolution. The request must still be approved by U.S. District Judge Analisa Torres.
Filed in 2020, the SEC’s lawsuit accused Ripple of raising $1.3 billion by selling XRP as unregistered securities.Â
Ripple denied wrongdoing, and in 2023 secured a partial legal win when Judge Torres ruled that programmatic sales of XRP on public exchanges to retail buyers did not constitute securities offerings. However, the court did find violations in Ripple’s institutional sales.
After that ruling, the SEC sought a $2 billion penalty, which was later reduced to $125 million. Under the proposed deal, Ripple and its top executives will pay $50 million, with the remaining funds reverting to Ripple. The SEC, under new leadership, has agreed to the arrangement.
The move comes as the SEC, under President Donald Trump, has begun to pivot away from its previously aggressive crypto enforcement under former President Joe Biden.Â
Several high-profile lawsuits and investigations initiated by former Chair Gary Gensler have since been dropped.
In May, SEC Commissioner Caroline Crenshaw criticized the shift, warning that the agency’s crypto retreat endangers investors.
Judge Torres had previously rejected a motion for an indicative ruling on the settlement, citing procedural issues due to the pending appeals before the Second Circuit. Both sides have since filed to suspend those appeals.
XRP was trading at $2.13 on Thursday, down 5.2% over the previous 24 hours, according to CoinGecko.
Edited by Sebastian Sinclair
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