The U.S. Securities and Exchange Commission (SEC) and Ripple Labs, Inc. have been locked in a legal fight since 2020. Now, they want to settle it. On June 12, 2025, both sides asked a court to release a $125 million escrow and end their dispute over XRP, Ripple’s cryptocurrency.
If the court agrees, the SEC would get $50 million, and Ripple would keep $75 million. This could close a case that has lasted five years and caught the attention of the crypto world.
How the Case Started
The SEC sued Ripple in December 2020. They said Ripple sold XRP as an unregistered security. This means they thought Ripple broke rules by not registering XRP with the government before selling it. The case mattered a lot because it could shape how the U.S. regulates cryptocurrencies.
A big moment came on July 13, 2023. Judge Analisa Torres ruled that Ripple’s sales to big investors broke securities laws, but sales to regular people on exchanges did not. You can read more about this ruling in Fenwick’s analysis.
Then, in August 2024, the judge made a final decision. Ripple had to pay a $125 million penalty. The SEC had wanted $2 billion, but the court said no. The judge also set a permanent rule to stop Ripple from breaking securities laws again. The court didn’t make Ripple pay back profits, saying there wasn’t enough proof that investors lost money. This followed a similar case with LBRY in 2023, as explained by CoinTelegraph.
The New Settlement Plan
On June 12, 2025, the SEC and Ripple filed a joint request in Manhattan District Court. They asked Judge Torres to let go of the $125 million escrow and cancel the 2024 rule against Ripple.
The plan splits the money: $50 million to the SEC and $75 million back to Ripple. They used examples from other cases, like Microsoft v. Baker, to show why the court should agree.
This isn’t the first try at a deal. In May 2025, they suggested a $50 million settlement, but the judge rejected it because of paperwork problems. Now, they’ve fixed those issues. They need the court to approve this before June 16, 2025, when they must update an appeals court.
Changes at the SEC
This settlement comes at an interesting time. The SEC has a new leader after the 2024 U.S. election. Paul Atkins became chair on April 9, 2025. He has ties to the crypto industry, which might explain a softer approach. Since he started, the SEC has stopped some big crypto cases.
For example, on February 27, 2025, they dropped a case against Coinbase. On May 29, 2025, they also ended a lawsuit against Binance, according to CNBC. These moves show the SEC might be rethinking how it handles crypto.
What It All Means
If the court says yes, this deal could end a long fight. The $125 million penalty would be split, with Ripple getting most of it back. This fits with the court’s earlier choice not to make Ripple repay profits. It also matches the SEC’s recent steps to ease up on crypto rules. The 2023 ruling about XRP sales and pressure from the public might have pushed this outcome.
Here’s a quick look at the case’s big moments:
| Date | Event | Details |
|---|---|---|
| December 2020 | SEC sues Ripple | Claims XRP is an unregistered security |
| July 13, 2023 | Judge rules on XRP | Some sales are securities, some aren’t |
| August 7, 2024 | Final penalty set | $125 million fine, no profit repayment |
| April 2025 | Talks to pause appeals begin | Both sides look for a deal |
| May 2025 | First settlement try fails | Court says no due to errors |
| June 12, 2025 | New settlement filed | $50M to SEC, $75M to Ripple, end restrictions |
Final Thoughts
The SEC and Ripple’s request on June 12, 2025, could wrap up their battle. It reflects bigger changes in how the SEC views crypto. If Judge Torres agrees, it might mean a friendlier future for digital currencies in the U.S.
The decision will affect not just Ripple but the whole crypto market. People are watching closely to see what happens next.
