Here's What May Happen to the Ripple v. SEC Case Under Trump's Administration

Overview of the Lawsuit

The ongoing lawsuit between Ripple and the U.S. Securities and Exchange Commission (SEC) began in 2020 when the SEC accused Ripple of raising over $1.3 billion through an unregistered securities offering by selling XRP. This case has seen various developments, including partial victories for Ripple, notably a 2023 ruling where Judge Torres stated that Ripple's XRP sales to retail investors did not breach securities laws.

Potential Settlement and Changes in Leadership

The SEC imposed a $125 million fine on Ripple for its direct sales of XRP to institutional investors, which were deemed violations of federal securities laws. While Ripple appeared prepared to settle, the SEC's appeal of the 2023 ruling delayed a resolution. However, with Donald Trump's recent election victory, some legal experts, including attorney Jeremy Hogan, speculate that the case may come to a quicker resolution.

Hogan predicts that Trump will likely replace SEC Chairman Gary Gensler shortly after taking office on January 20, 2025. He suggests that the new leadership could dismiss many non-fraud crypto lawsuits, including the Ripple case, leading to a potential settlement at the previously ruled amount of $125 million.

Expert Opinions on Case Outcomes

Another attorney, Fred Rispoli, views Trump's election as a positive development for Ripple, anticipating significant changes at the SEC by March or April 2025. However, he argues that a complete dismissal of the case is unrealistic and that the $125 million penalty represents the SEC's best outcome. Rispoli believes that the new SEC leadership will acknowledge the weaknesses in the case and may consider reducing the fine while allowing Ripple to structure its current sales of XRP to avoid being classified as investment contracts.