The Ripple XRP lawsuit outcome is final: in August 2025, Ripple Labs and the Securities and Exchange Commission jointly dismissed their appeals, leaving in place the judgment Judge Analisa Torres entered a year earlier. Ripple pays a $125 million civil penalty, remains under a permanent injunction against unregistered institutional sales of XRP, and keeps the benefit of the court’s headline finding that XRP itself is not a security and that programmatic sales of the token on public exchanges were not securities transactions.1SEC. SEC v. Ripple Labs, Litigation Release No. 26369
What the Final Judgment Says
Judge Torres entered final judgment on August 7, 2024. Ripple was ordered to pay $125,035,150, covering 1,278 institutional sale transactions that the court had already found violated federal securities laws. The number came in well below what the SEC asked for. The agency had pushed for roughly $2 billion, including about $900 million in civil penalties and roughly $1 billion in disgorgement and prejudgment interest.2CoinDesk. Judge Fines Ripple $125M, Bans Future Securities Law Violations in Long-Running SEC Case
The court rejected disgorgement, finding that the institutional buyers had not suffered monetary harm, and declined to impose a blanket ban on all future institutional XRP sales.3Manatt. Ripple Labs Ordered to Pay $125 Million Civil Fine It did issue a permanent injunction barring Ripple from future violations of the Securities Act’s registration requirements, citing a “reasonable probability of future violations.”2CoinDesk. Judge Fines Ripple $125M, Bans Future Securities Law Violations in Long-Running SEC Case
To understand what the penalty and injunction cover, you have to go back to the summary judgment ruling of July 13, 2023. That is where the substantive win and loss for each side actually happened.
XRP Itself Is Not a Security
Judge Torres wrote that XRP, as a token, is simply a digital code and “not in and of itself a ‘contract, transaction, or scheme’ that embodies the Howey requirements of an investment contract.” Whether a sale of XRP counted as a securities transaction depended on the circumstances of the sale.4U.S. District Court, Southern District of New York. SEC v. Ripple Labs, Summary Judgment Order
Institutional Sales Lost, Programmatic Sales Won
The court split Ripple’s XRP sales in two. Roughly $728.9 million in direct sales to hedge funds and other sophisticated buyers satisfied all three prongs of the Howey test: investment of money, common enterprise, and a reasonable expectation of profit from Ripple’s efforts. Those were unregistered securities offerings.4U.S. District Court, Southern District of New York. SEC v. Ripple Labs, Summary Judgment Order
The court reached the opposite conclusion for roughly $757.6 million in “programmatic” sales executed anonymously on public exchanges. Because buyers on those platforms had no way of knowing whether they were purchasing from Ripple or from any other seller, they could not reasonably have expected profits tied specifically to Ripple’s efforts. Those sales were not securities transactions.4U.S. District Court, Southern District of New York. SEC v. Ripple Labs, Summary Judgment Order
It was the first time a federal court had held that the same token could be a security in one context and not in another. That distinction is the ruling’s most consequential feature, and the SEC’s cross-appeal was aimed squarely at it.
The Individual Executives Walked
The SEC had also sued CEO Brad Garlinghouse and co-founder Christian Larsen for aiding and abetting Ripple’s violations. Judge Torres denied summary judgment on those claims, meaning a jury trial would have been required to resolve them. In October 2023, the SEC voluntarily dropped the individual charges rather than proceed to trial.5Fortune. SEC Drops Charges Against Ripple Execs Garlinghouse and Larsen
How the Case Actually Ended
Both sides initially appealed the August 2024 judgment. Ripple challenged the institutional-sales finding, and the SEC cross-appealed the programmatic-sales holding.1SEC. SEC v. Ripple Labs, Litigation Release No. 26369 Then the political landscape changed. Gary Gensler stepped down as SEC Chair in January 2025, and Paul Atkins took over.
On May 8, 2025, the parties announced a private deal to end the appeals. Ripple’s penalty would drop from $125 million to $50 million, the permanent injunction would be dissolved, and the remaining escrow funds would go back to Ripple.6SEC. SEC v. Ripple Labs, Litigation Release No. 26306
Judge Torres refused to approve it. In a June 26, 2025 order, she denied the parties’ request to unwind the injunction and release the escrow, writing that the injunction remained necessary because of “the enormous sums of money Ripple made in violating the law and Ripple’s incentives to continue doing so,” and that the reasonable probability of future violations she had found originally “has not changed.”7CoinDesk. NY Judge Slaps Down SEC, Ripple’s Second Request for an Indicative Ruling on Proposed $50M Settlement The parties, she said, lacked authority to agree to disregard a court’s final judgment and had not shown “exceptional circumstances that outweigh the public interest.”8Blockworks. Judge Denies Ripple SEC Motion
The next day, Garlinghouse announced Ripple would drop its cross-appeal, saying, “We’re closing this chapter once and for all.”9Reuters. Ripple to Drop Cross-Appeal Against US SEC in Crypto Lawsuit, CEO Says On August 7, 2025, the parties filed a joint stipulation of dismissal in the Second Circuit. The original judgment stands as entered: $125 million, the permanent injunction, and the split ruling on institutional and programmatic sales.1SEC. SEC v. Ripple Labs, Litigation Release No. 26369
What the Ruling Does Not Settle
The Torres decision is often described as having established that XRP is not a security and that secondary-market crypto sales aren’t securities transactions. Read carefully. The ruling binds only this case, and other judges in the same district have already gone the other way.
Weeks after the Ripple ruling, Judge Jed Rakoff in SEC v. Terraform Labs rejected Judge Torres’s distinction between direct sales and anonymous exchange sales, reasoning that issuers typically represent that proceeds from all sales benefit all token holders, so exchange buyers have the same expectation of profits as direct buyers.10Jones Day. Ripple and Terraform Labs: Two New York District Courts Address the Status of Certain Crypto Assets as Securities In March 2024, Judge Katherine Failla took the same view in SEC v. Coinbase, writing that there was “little logic” in distinguishing between issuer sales and secondary-market sales, and noting that no court since Howey had required a direct contractual relationship between issuer and buyer.11Fintech and Digital Assets Blog. Ruling for SEC Clears Path for Continued Litigation in SEC v. Coinbase
An appellate ruling from the Second Circuit could have resolved that split. The August 2025 dismissal ensured it won’t. The Torres decision is persuasive authority a crypto defendant can cite, but it coexists with conflicting district-court precedent and carries no appellate endorsement.
What Changed After the Case Ended
The market moved quickly. XRP climbed from around $2.80 in early August 2025 to $3.27 after the joint dismissal, and 7,000 new wallets were created within 24 hours of the news.12Bitget Academy. SEC Ripple XRP Lawsuit Settled: Price Rebound
CME Group had launched cash-settled XRP futures on May 19, 2025, in 2,500-XRP and 50,000-XRP contract sizes.13CME Group. CME Group to Expand Crypto Derivatives Suite With Launch of XRP Futures Open interest hit $1 billion by August, the fastest any CME contract has reached that level, and climbed to a record 9,900 contracts by late October.14Yahoo Finance. XRP CME Futures Hit Record
Spot ETFs followed. The first, REX-Osprey’s XRPR, launched September 18, 2025. By late November, funds from Canary Capital, Bitwise, Grayscale, Franklin Templeton, and 21Shares had joined it. As of early 2026, seven spot XRP ETFs trade in the U.S. with combined assets of $1.53 billion, and a 14-day stretch of consecutive daily inflows brought in more than $906 million.15Ripple. XRP ETFs: The Institutional Era Has Begun
At the SEC, the Ripple deal fit into a broader shift. Beginning in February 2025, the Commission dismissed seven major crypto enforcement actions inherited from the Gensler era, including cases against Coinbase, Binance, and Consensys.16SEC. SEC Press Release 2026-34 Crypto enforcement actions fell from 33 in 2024 to 13 in 2025, and total monetary penalties against digital-asset participants dropped to $142 million, under 3% of the prior year’s total.17Cornerstone Research. SEC Cryptocurrency Enforcement Update Acting Chairman Mark Uyeda created a Crypto Task Force under Commissioner Hester Peirce in January 2025 to build a formal regulatory framework, and in March 2026 the SEC and CFTC jointly issued Commission-level guidance applying the Howey test to crypto assets, with a five-category taxonomy covering staking, mining, and airdrops.18SEC. Application of the Federal Securities Laws to Certain Types of Crypto Assets
Where Ripple Stands Now
With the litigation behind it, Ripple moved into expansion. In April 2025 it announced the $1.25 billion acquisition of non-bank prime broker Hidden Road, which closed in October 2025 and was rebranded Ripple Prime.19FT Partners. Hidden Road Transaction Ripple launched RLUSD, a dollar-backed stablecoin under a New York Department of Financial Services trust charter, in December 2024,20Fortune. Ripple Announces Launch of RLUSD Stablecoin and in early 2026 secured a $500 million strategic investment from Citadel Securities, Pantera Capital, and Galaxy Digital at a $40 billion valuation. Despite the removal of the legal cloud, President Monica Long said Ripple has “no plans or timeline for an IPO.”21TradingView (Cointelegraph). Ripple Rejects IPO Plans Despite SEC Case Victory
The permanent injunction remains in force. If Ripple resumes the kind of institutional sales the court held violated the Securities Act, the SEC would not need to relitigate whether those sales are securities transactions; the finding is already on the books.