In a pivotal development that could signal the end of one of the most closely watched legal battles in cryptocurrency history, Ripple Labs and the U.S. Securities and Exchange Commission (SEC) have jointly filed a motion to pause their ongoing appeals in the long-standing XRP lawsuit.
Submitted on April 10 to the Second Circuit Court of Appeals, the motion reveals that both parties have reached an “agreement-in-principle” and are now actively pursuing a negotiated resolution. This marks a significant shift from years of adversarial litigation toward what appears to be a collaborative effort to close the chapter on a case that has shaped the regulatory landscape for digital assets in the United States.
The Turning Point in the XRP Lawsuit
The XRP lawsuit, initiated by the SEC in December 2020, alleged that Ripple conducted an unregistered securities offering through the sale of XRP tokens. At its core, the case raised fundamental questions about how cryptocurrencies should be classified under U.S. law—whether as securities or as commodities.
After more than four years of legal proceedings, the two sides have now jointly requested that their appeal and cross-appeal be held in abeyance—effectively pausing all litigation for 60 days. According to the court filing, this temporary halt is intended to “conserve judicial and party resources while the parties continue to pursue a negotiated resolution.”
This move cancels Ripple’s previously scheduled April 16 deadline to respond to the SEC’s appeal brief. James Filan, Ripple’s legal counsel, confirmed the development on social media, stating: “The settlement is awaiting Commission approval. No brief will be filed on April 16.”
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From Partial Victory to Potential Settlement
A critical turning point came in July 2023 when Judge Analisa Torres ruled that while Ripple’s institutional sales of XRP violated securities laws, its programmatic sales on public exchanges did not constitute securities offerings. This nuanced decision gave Ripple a partial legal victory and laid the groundwork for potential settlement discussions.
Since then, Ripple leadership has signaled growing confidence in a favorable outcome. CEO Brad Garlinghouse declared last month that the case was effectively over, while Chief Legal Officer Stuart Alderoty confirmed the company would not pursue a cross-appeal. The latest joint motion extends to all remaining claims—including those against Garlinghouse and co-founder Chris Larsen—further reinforcing market speculation that a final settlement is imminent.
One factor potentially influencing the timing is recent leadership change at the SEC. Paul Atkins, a known proponent of balanced crypto regulation, was confirmed as the new SEC Chair on April 9. With his swearing-in expected shortly, insiders suggest the commission may be waiting for his official assumption of duties before finalizing any agreement.
As one industry observer noted: “SEC is ready to settle but is waiting for Atkins to take the helm… to start off with dropping the biggest case of their career and start with a huge win.”
Market Reaction and XRP Price Outlook
Despite the positive legal developments, XRP experienced a short-term price dip of 4.24% on April 10, falling to $1.9649—erasing some gains from the prior day’s 14.32% surge. However, market data from CoinMarketCap shows XRP has since recovered, trading around $2.01 with a 24-hour trading volume exceeding $4.14 billion.
Technical analysis suggests bullish momentum remains intact. XRP has broken above the $2 resistance level—a psychological threshold that traders have monitored closely. Analyst Egrag Crypto forecasts that with increased regulatory clarity and macroeconomic tailwinds, XRP could reach as high as **$27** in the coming years.
Furthermore, recent institutional developments have added credibility to XRP’s long-term prospects. The approval of the Teucrium 2X Long XRP ETF by NYSE Arca signals growing confidence among traditional financial players in XRP as a compliant digital asset.
Broader Implications for Crypto Regulation
A finalized settlement between Ripple and the SEC would extend far beyond one company’s legal fate. It could establish crucial precedents for how cryptocurrencies are regulated in the U.S., particularly regarding token classification.
Ripple is reportedly expected to pay a reduced civil penalty—around **$50 million**, down sharply from the SEC’s original $125 million demand. This outcome may allow Ripple to reestablish partnerships with major financial institutions like Bank of America and expand its U.S.-based operations.
Moreover, it could position Ripple’s blockchain as a leading compliant infrastructure for cross-border payments, reinforcing its role in modernizing global finance.
Legal experts see this shift as part of a broader recalibration in SEC enforcement strategy. “The SEC’s move to pause litigation and negotiate with Ripple—alongside dropping cases against Coinbase and Kraken—points to a broader regulatory rebalancing,” said a lawyer familiar with the matter.
If approved, this settlement could redefine the SEC’s approach—from aggressive enforcement to negotiated regulatory clarity, offering much-needed guidance for innovators across the crypto space.
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Frequently Asked Questions (FAQ)
Q: What does 'pause in abeyance' mean in legal terms?
A: It means both parties have agreed to temporarily suspend court proceedings while they work toward a settlement. No further legal action occurs during this period unless requested.
Q: Will XRP be classified as a commodity if the case settles?
A: While no official classification has been made yet, multiple reports indicate the SEC is prepared to treat XRP as a commodity post-settlement—a major win for Ripple and the broader crypto industry.
Q: How might this affect other crypto lawsuits?
A: A favorable resolution could encourage other firms facing similar charges (like Coinbase or Binance) to pursue negotiated settlements rather than prolonged litigation.
Q: Is Ripple completely off the hook legally?
A: Not entirely—the settlement still requires formal approval by SEC commissioners. However, the joint motion strongly suggests both sides are aligned on key terms.
Q: Could this lead to a spot XRP ETF?
A: Yes. With growing regulatory clarity, applications for spot XRP ETFs—similar to those for Bitcoin and Ethereum—become more viable. Grayscale has already expressed interest in listing one on NYSE.
Q: What happens if the SEC rejects the settlement?
A: In that unlikely scenario, appeals would resume, prolonging uncertainty. But given current signals, rejection appears improbable.
The Road Ahead for Ripple and Digital Assets
As both parties await formal approval from SEC commissioners, the next 60 days will be critical. If the settlement is finalized, Ripple could emerge as a model for future crypto compliance, demonstrating how blockchain innovation and regulatory oversight can coexist.
For XRP holders and the wider crypto community, this development brings hope of resolution after years of legal ambiguity. While it remains to be seen whether XRP’s price will surge on final settlement news, one thing is clear: we may be witnessing the dawn of a new era—one defined by cooperation, compliance, and clearer rules for digital asset markets.
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