Legal experts are buzzing after recent comments suggested the SEC’s long-running lawsuit against Ripple Labs might soon reach a conclusion. Andrew Parish, co-founder of Arch Public, shared insights from two sources indicating that the Ripple case could soon end.
Outcome 1: XRP Classified as a Commodity
The first potential outcome Parish mentioned is that XRP could officially be classified as a commodity rather than a security. This decision would change the way how the cryptocurrency is regulated in the United States.
Initially, the SEC sued Ripple Labs in December 2020, claiming XRP was a security. The SEC accused Ripple of illegally selling XRP tokens to investors without registering them properly as securities.
However, in August 2024, a federal judge ruled against the SEC’s initial classification, stating that XRP itself was not a security. Notably, the SEC did not challenge this ruling during its appeal, which strengthens the possibility of XRP’s future commodity status.
Outcome 2: Reduction in Ripple’s Fine
Parish also indicated Ripple might receive a greatly reduced fine from the SEC. Originally, Judge Analisa Torres ordered Ripple to pay $125 million for violating federal securities laws by selling XRP directly to institutional investors without proper registration. She also imposed a permanent injunction barring Ripple from selling XRP to institutions.
According to Parish, the SEC’s current leadership appears open to reducing the fine significantly. This could mean Ripple will pay far less than the original $125 million penalty.
Outcome 3: Setting a Major Legal Precedent
The final outcome Parish talked about is the broader impact of the case. He emphasized that the way the SEC handles Ripple’s case will set an legal precedent for future cryptocurrency regulations. The SEC’s new leadership understands the importance of carefully managing this outcome, given its influence on upcoming crypto-related lawsuits.
Ripple Negotiating With SEC for Better Settlement Terms
Prominent XRP community attorneys reacted to Parish’s comments. Attorney John Deaton, who represents XRP holders, drew attention to Parish’s claims, signaling their potential importance. Attorney Fred Rispoli also responded, noting he tends to believe Parish’s positive statements on XRP, despite Parish’s typical criticism.
Recent statements by crypto journalist Eleanor Terrett support Parish’s claims. Terrett previously cited sources within the SEC who confirmed Ripple’s legal team is negotiating to remove the permanent injunction and secure better settlement terms.
Ripple argues the penalties from the August ruling are unfair, especially since the SEC recently dismissed other crypto-related lawsuits.
Neither Ripple nor the SEC has officially confirmed ongoing settlement discussions. However, speculation continues to build as the deadline for Ripple’s legal reply on April 16 approaches.
XRP Price and ETF Prospects Await Lawsuit Resolution
Amid speculations surrounding Ripple v.s SEC case, Ripple’s native token XRP fell nearly 2% to $2.26.
Market analysts suggest that a favorable settlement, including reduced penalties or XRP’s recognition as a commodity, could lead to further price gains. Additionally, the possibility of an XRP-spot ETF approval could attract institutional investors, potentially pushing XRP beyond its previous highs toward $5.
