Judge Analisa Torres has turned down a proposed $50 million settlement between Ripple and the U.S. Securities and Exchange Commission (SEC), which would have eliminated the permanent injunction preventing institutional sales of XRP.
In a ruling issued on June 26, the judge’s decision ensures that Ripple’s commercial restrictions will remain in place indefinitely, despite both parties previously agreeing to a significant reduction of the original $125 million penalty by 60%.
#XRPCommunity #SECGov v. #Ripple #XRP BREAKING: Judge Torres has denied the parties’ Motion for an Indicative Ruling. pic.twitter.com/9AMhGcQUsU
— James K. Filan (@FilanLaw) June 26, 2025
Judge Torres found that neither party demonstrated the “exceptional circumstances” needed to vacate a final judgment. She underscored that the public’s interest in upholding securities enforcement takes precedence over private settlement agreements.
This ruling means that while XRP remains legally barred from institutional sales, retail trading can continue without disruption.
Four Years of Legal Warfare Reaches Another Dead End
The SEC first initiated its investigation into Ripple in December 2020, claiming that the company executed a $1.3 billion unregistered securities offering through its XRP sales.
This case has generated significant debate over whether XRP should be classified as a security or a commodity under federal law, which could have far-reaching implications for the digital asset industry as a whole.
In July 2023, Torres issued a divided ruling that has been regarded as one of the most complex decisions within cryptocurrency law.
Court Trial Dates Set for SEC’s Case Against Ripple Labs in Southern District of New York
Judge Analisa Torres, who is handling the civil case of the US SEC against @Ripple Labs, intends to set a jury trial for the second quarter of 2024.#Finance Newso https://t.co/lmDpBvIJA3
— Finance Newso.com (@Finance Newso) August 10, 2023
In her findings, Torres determined that while institutional sales of XRP violated securities laws, retail exchanges did not fulfill the criteria for being classified as investment contracts under the Howey Test. This nuanced decision resulted in a permanent injunction against Ripple from selling XRP to institutional buyers, while permitting retail market operations to proceed unhindered.
The court also imposed a civil penalty of $125 million, which both parties later appealed.
A proposed settlement in May 2025 seemed to provide a potential resolution for both sides. Under the terms, Ripple would pay $50 million to reduce the original penalty by $75 million, in exchange for the SEC’s agreement to lift the injunction on institutional sales.
@Ripple settles with the @SECGov, agreeing to pay a $50M penalty and dropping its cross-appeal, marking the near conclusion of a long-standing lawsuit.#SEC #Crypto #Ripplehttps://t.co/txqDDCnn0G
— Finance Newso.com (@Finance Newso) March 25, 2025
She emphasized that changes in SEC policies during the Trump administration did not constitute “exceptional circumstances,” considering her court had already established violations of securities laws.
Contrasting Fortunes in the New Regulatory Era of Trump
The protracted legal battle faced by Ripple sharply contrasts with the swift resolutions seen in other significant SEC cases during 2025.
Recently, the SEC has ceased enforcement actions against various entities, including Coinbase, Cumberland DRW, and Gemini, while concluding investigations into Uniswap, OpenSea, and Robinhood Crypto without pursuing charges.
These developments reflect a broader shift in the SEC’s approach under Acting Chair Mark Uyeda and incoming Chair Paul Atkins, who prioritize regulatory clarity over aggressive enforcement tactics.
SEC Chair Paul Atkins made remarks at the agency’s Friday roundtable that indicated a shift towards common sense digital asset regulation.#PaulAtkins #SECChairhttps://t.co/1Z00g8ent4
— Finance Newso.com (@Finance Newso) April 25, 2025
The agency’s retreat from multiple cryptocurrency cases has sparked optimism about a more cooperative regulatory environment. However, Ripple’s case remains complicated due to existing court findings of securities violations.
The restriction on institutional sales has continually hindered Ripple’s growth opportunities, particularly concerning partnerships with banks and financial institutions—core to the company’s original business model.
As Ripple navigates its unique challenges, the SEC continues to face criticism for its enforcement decisions, which many view as inconsistent with its evolving policy stance. The prospects for Ripple to gain similar regulatory leniency as other crypto firms remain uncertain, especially as the company contends with a final judgment declaring that its institutional XRP sales were in violation of federal law.
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