Ripple v. SEC Lawsuit: Here’s Why a Quick Resolution Is Unlikely

TL;DR

• Experts argue that Ripple’s legal battle with the SEC is far more complex, involving procedural intricacies like an existing $125 million penalty and ongoing jurisdictional oversight until August 7.
• Others have pointed to the recent changes in its management team to envision a potential pause of all crypto-related cases.

Settled Rather Than Dismissed?

The legal tussle between Ripple and the US Securities and Exchange Commission (SEC) dates back to December 2020 and is among the most-discussed topics in the cryptocurrency industry. Some recent developments and partial court wins in favor of the company have sparked speculation that a resolution could be forthcoming, but the case remains open.

Last week, Coinbase’s CEO Brian Armstrong revealed that his firm reached an agreement with the securities regulator to dismiss their lawsuit. The XRP Army celebrated the news, arguing that the next dropped case could be against Ripple.

The popular US lawyer Jeremy Hogan, though, believes such a scenario is not that simple. He maintained that the battle against Ripple is more complicated and is more likely to be settled rather than dismissed.

“The SEC broke up with Coinbase after a couple dates. Ripple and the SEC live together and have a baby,” the attorney stated.

Eleanor Terrett (a journalist at Fox Business) shared a similar thesis. She claimed that the Ripple case is “more procedurally complex” than the one against Coinbase because Judge Torres has already ordered a $125 million penalty on the company for violating certain rules. The journalist cited the final judgment to remind that the magistrate can retain jurisdiction until August 7 “to make sure the terms of the order are met.”

“While the SEC could choose to drop the appeal at the Second Circuit, they would also need to figure out how to approach the district court and possibly come to an agreement on the penalty ruling (reduce or ask to drop) and presumably get Torres’s blessing as the presider.

There’s a degree of uncertainty in all of this because, as one legal source tells me: “We are in uncharted territory right now,“” she added.

Another Opinion

Earlier this month, John Reed Stark (a former SEC employee) also chipped in on the matter. He thinks the watchdog might soon pause all crypto-related appeals, including the one against Ripple.

Stark based his theory on the agreement between the SEC and Binance and the recent changes in the regulator’s leadership. 

Recall that the regulator transferred one of its top crypto litigators, Jorge Tenreiro, to its IT department. The law expert joined the Commission more than 10 years ago, gradually climbing the ladder to become Chief Litigation Counsel in 2024. Tenreiro signed the SEC’s notice of appeal in its case against Ripple.

“Yet, this SEC trial lawyer, who championed the victories of Coinbase and Binance, is now glaringly absent from both the Coinbase and Binance pleadings, ordered to pack his pencils and legal pads and transfer to the SEC’s IT department,” Stark stated.

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