XRP Surges 10% as Ripple CEO Announces SEC Dropping Case Against Ripple

In a significant development for the cryptocurrency industry, XRP prices soared by 10% on Wednesday after Ripple CEO Brad Garlinghouse announced that the U.S. Securities and Exchange Commission (SEC) is set to drop its appeal against Ripple. The announcement marks a potential end to a years-long legal battle that has weighed heavily on the crypto market since 2020.

Garlinghouse took to social media platform X (formerly Twitter) to share the news, calling it a “resounding victory for Ripple, for crypto, every way you look at it.” His statement comes amid earlier reports suggesting that the SEC’s lawsuit against Ripple, which accused the company of conducting unregistered securities sales of XRP tokens, is nearing its conclusion.

The SEC initially filed the lawsuit in December 2020, alleging that Ripple raised $1.3 billion through the sale of XRP tokens, which the regulator claimed were unregistered securities. The case has been closely watched by the crypto industry, as its outcome could set a precedent for how digital assets are regulated in the U.S.

In a landmark ruling in 2023, U.S. Judge Analisa Torres determined that while Ripple violated federal securities laws through institutional sales of XRP, its programmatic sales to retail investors did not constitute securities offerings. This partial victory for Ripple was followed by a $125 million fine imposed on the company in August 2023. The SEC later filed a notice of appeal, but Garlinghouse’s recent announcement suggests the regulator is now backing down.

The lawsuit has had a significant impact on XRP holders, with Garlinghouse estimating that the legal battle caused $15 billion in losses for investors. The case has also been viewed as a pivotal moment in the SEC’s broader crackdown on the crypto industry, with Garlinghouse describing it as the “first major shot fired in the war on crypto.”

The SEC’s decision to drop the appeal aligns with a shift in the regulator’s approach under new leadership. Following the departure of former SEC Chair Gary Gensler, the agency has dropped several high-profile cases, including its investigation into Coinbase. The potential appointment of Paul Atkins as the next SEC chair could further influence the regulatory landscape, though his confirmation hearing has yet to be scheduled by the Senate.

Ripple’s legal victory could also pave the way for broader adoption of XRP, including the potential approval of an XRP exchange-traded fund (ETF). Major asset managers such as Grayscale, Bitwise, and Franklin Templeton have already filed applications for an XRP ETF, with Bloomberg analysts estimating a 65-75% chance of approval by the end of 2024.

The resolution of the lawsuit is a significant milestone for Ripple and the crypto industry, signaling a potential shift toward clearer regulatory frameworks. As the market reacts to the news, XRP’s price surge reflects growing optimism among investors and stakeholders.

The SEC has declined to comment on Garlinghouse’s statement, but the development underscores the evolving dynamics between regulators and the crypto sector. With the legal battle seemingly coming to an end, Ripple and XRP are poised to play a pivotal role in the future of digital assets.