Ripple Labs and the U.S. Securities and Exchange Commission (SEC) have jointly agreed to release $125 million held in escrow to settle their protracted legal dispute.
The agreement, pending court approval, stipulates that $50 million will be paid to the SEC as a civil penalty, while $75 million will be refunded to Ripple. This settlement aims to conclude nearly five years of litigation and conserve judicial resources.
The resolution follows a pivotal July 2023 ruling by Judge Analisa Torres, which determined that secondary market sales of XRP tokens did not constitute securities transactions, although initial institutional sales were deemed securities offerings.
Earlier this year, SEC Chairman Gary Gensler announced the agency’s decision to drop its appeal related to the ruling. Subsequently, Ripple withdrew its cross-appeal, paving the way for the case’s final resolution.
Industry observers view the settlement as a significant victory for Ripple and the broader cryptocurrency sector, providing crucial regulatory clarity and fostering innovation within a more defined legal framework.