- Judge Analisa Torres denies the joint request from the SEC and Ripple for an indicative ruling to dissolve the $125 million penalty order.
- Judge Torres cited procedural issues, emphasizing the need for a compelling case to justify withdrawing her ruling.
- XRP price shows strength, rising slightly above support at $2.40, although its upside potential remains uncertain.
The price of Ripple (XRP) is largely trading sideways around $2.41 on Friday, rising slightly after a minor correction from this week’s peak of $2.65 to support at $2.34. This occurs after U.S. District Judge Analisa Torres rejected the joint request from Ripple Labs and the Securities and Exchange Commission (SEC) for an indicative ruling. The parties had reached a settlement agreement last week, pending court approval.
Joint Request from the SEC and Ripple for an Indicative Ruling Denied
Judge Analisa Torres of the U.S. District Court for the Southern District of New York has rejected a joint request from Ripple and the SEC for an indicative ruling that would have seen the token issuer pay only $50 million as a penalty instead of the $125 million imposed by the Court in 2024.
The lawsuit filed by the SEC in December 2020 alleged that Ripple “engaged in the unlawful offer and sale of securities in violation of Section 5 of the Securities Act.” According to the ruling on July 12, 2023, “the Court granted in part and denied in part the parties’ motion for summary judgment.”
Judge Torres ruled that the sale of XRP on the open market or on cryptocurrency exchanges did not constitute a security. However, Ripple had a case to answer for its direct institutional sale of XRP tokens.
Ripple was penalized $125 million, significantly below the SEC’s initial request of $2 billion for partially violating the Securities Act. The money was deposited into an interest-bearing account, but Ripple and the SEC appealed the ruling, with the cross-appeals pending trial before the Second Circuit.
Ripple and the SEC agreed on May 8 to seek to resolve the lawsuit in both the District Court and the Second Circuit. The parties mutually agreed that Ripple would pay $50 million to the SEC upon the annulment of the order against Ripple Labs, subsequently reducing the penalty by 60%.
In dismissing the joint request for an indicative ruling, Judge Torres cited procedural issues, adding that the District Court must “determine whether the proposed consent decree is fair and reasonable with the additional requirement that the public interest would not be disserved should the court” move to grant the motion that would effectively end the lawsuit.
Despite the denial, Judge Torres outlined a clear path that the SEC and Ripple must follow to ensure the agreement is fair and reasonable. According to cryptocurrency lawyer John Deaton, the Court must ensure that the thousands of legal hours and judicial effort dedicated to the case over the past five years have not been in vain.
Ripple’s Chief Legal Officer, Stuart Alderoty, said after the ruling that Ripple will work with the SEC to review the matter. Alderoty clarified that the ruling does not jeopardize Ripple’s past victories, as XRP is not a security.
Nothing in today’s order changes Ripple’s victories (i.e. XRP is not a security, etc). This is about procedural issues with dismissing Ripple’s cross-appeal. Ripple and the SEC are fully aligned in wanting to resolve this case, and will review this issue with the Court, together. https://t.co/vBQdBD3FNe
— Stuart Alderoty (@s_alderoty) May 15, 2025
XRP’s Uptrend Remains Firm Despite the Ruling
XRP price gains slightly more than 1% on Friday, trading around $2.41 at the time of writing. The token’s short-term technical outlook is structurally bullish with the Moving Average Convergence/Divergence (MACD) indicator above the midline. At the same time, the MACD line (blue) being above the signal line (red) maintains the buy signal confirmed on May 8. A buy signal manifests when the MACD line crosses above the signal line.
XRP’s position above three bullishly trending moving averages, ranging from the 50-day Exponential Moving Average (EMA) at $2.27, the 100-day EMA at $2.25, to the 200-day EMA at $2.03, signals strong bullish momentum.
XRP/USDT Daily Chart
For now, the uptrend target at $3.00 remains in sight, with traders likely looking for a daily close above $2.40, the immediate support. A break above the weekly peak of $2.65 would encourage traders to buy XRP, as confidence improves for a breakout towards $3.00.
However, XRP is not out of the woods, and a prolonged drop towards the 200-day EMA support at $2.00 cannot be ruled out yet. The Relative Strength Index (RSI) indicator at 56.36 reflects the drop from $2.65 in recent days. If headwinds obscure demand, XRP could explore lower levels as the RSI indicator descends below the midline at 50 towards the oversold region.
SEC vs Ripple FAQs
It depends on the transaction, according to a court ruling published on July 14:
For institutional investors or over-the-counter (OTC) sales, XRP is a security.
For retail investors who purchased the token through programmatic sales on exchanges, on-demand liquidity services, and other platforms, XRP is not a security.
The Securities and Exchange Commission (SEC) accused Ripple and its executives of raising over $1.3 billion through an unregistered asset offering of the XRP token.
Although the judge ruled that programmatic sales are not considered securities, sales of XRP tokens to institutional investors are investment contracts. In the latter case, Ripple did violate U.S. securities law and will have to continue litigating for the approximately $729 million it received under written contracts.
The ruling offers a partial victory for both Ripple and the SEC, depending on what you look at.
Ripple gets a big win from the fact that programmatic sales are not considered securities, and this could bode well for the cryptocurrency sector in general, as most of the assets in the SEC’s sights are managed by decentralized entities that sold their tokens primarily to retail investors through exchange platforms, experts say.
Still, the ruling doesn’t do much to answer the key question of what makes a digital asset a security, so it’s still unclear whether this lawsuit will set a precedent for other open cases affecting dozens of digital assets. Issues such as what is the appropriate degree of decentralization to avoid the “security” label or where to draw the dividing line between institutional and programmatic sales are likely to persist.
The SEC has stepped up its enforcement actions toward the blockchain and digital asset sector, filing charges against platforms such as Coinbase or Binance for allegedly violating U.S. securities law. The SEC claims that most crypto assets are securities and are therefore subject to strict regulation.
Although defendants may use parts of the Ripple ruling to their advantage, the SEC may also find in it reasons to maintain its current strategy of regulation through enforcement.
The court decision is a partial summary judgment. The ruling can be appealed once a final judgment is entered or if the judge allows it earlier. The case is in a pre-trial phase, in which both Ripple and the SEC still have the possibility of reaching an agreement.
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