- Judge Torres rejected the Ripple-SEC deal as procedurally improper.
- XRP fell over 6%, while 2025 chances of a price rally dropped on Polymarket.
- Ripple and the SEC must refile to end the case and lift the injunction.
Just when they thought they were out, they got pulled back in.
Ripple and the Securities and Exchange Commission tried to end their four-year-long legal battle with a joint request to dissolve a court injunction and slash Ripple’s penalty.
District Judge Analisa Torres rejected the request, saying she would deny it even if jurisdiction were restored, calling the motion “procedurally improper.”
The price of XRP dropped more than 6% following the decision, and traders on the prediction platform Polymarket quickly recalibrated.
The chances of XRP hitting a new all-time high in 2025 sank from a record 63% to 42% overnight.
Ripple’s Chief Legal Officer, Stuart Alderoty, brushed off the setback, calling it a hiccup.
“Nothing in today’s order changes Ripple’s wins,” he wrote on X, adding, “this is about procedural concerns with the dismissal of Ripple’s cross-appeal.”
He added that the company and the SEC still intend to revisit the issue with the court.
Not so fast
The May 7 filing asked the court to signal whether it would approve a resolution to dissolve the August 2024 injunction and cut Ripple’s penalty from $125 million to $50 million.
But Judge Torres rejected the move, saying the parties hadn’t used the proper legal process and failed to make the case for why such relief would be justified.
According to attorney James K. Filan, the next steps to finally conclude the case would have been straightforward had the judge agreed.
The case would have returned to her court to lift the injunction, release Ripple’s funds, with $50 million going to the SEC, and allow both sides to drop their appeals.
But that process is now paused and likely delayed for several months.
Crypto attorney John Deaton called the ruling a “curveball” and suggested Judge Torres may be signalling frustration, particularly with the SEC.
“This case tied this woman’s courtroom and her staff for five years,” he said on a recent X broadcast. “Now the SEC comes around and says, ‘Just kidding — reduce the fine, forget the injunction,’ and the judge is saying, ‘Not so fast.’”
Deaton pointed out that the judge’s language focused not just on legal technicalities, but on public interest.
“This is the judge saying to the SEC and Ripple, ‘I’m not rubber-stamping anything. Convince me,’” he said.
He added that the burden is now on both parties to frame their revised request around broader policy considerations, including Congress’ shifting stance on crypto and the lack of harm to institutional investors.
A defining crypto case
The case, first filed in 2020, has become a defining legal battle for the crypto industry.
The SEC alleged that Ripple’s sale of XRP amounted to an unregistered securities offering.
In a 2023 partial ruling, Judge Torres found that XRP was not a security in public exchange sales, but that Ripple’s direct institutional sales did violate federal securities laws.
While the SEC, now led by Trump-appointed Chair Paul Atkins, has pulled back from enforcement actions against Coinbase and Kraken, Ripple’s case still remains procedurally entangled.
“Ultimately, this is just another speed bump,” Deaton said. “But they’re going to have to come back with something stronger, and the judge made it clear, she’s not going to be rushed.”
Crypto market movers
- Bitcoin has gained 1.3% over the past 24 hours and is trading at $103,720.
- Ethereum is up 2.4% in the same period to $2,610.
What we’re reading
- Arthur Hayes says Bitcoin price will hit $1m thanks to falling confidence in US Treasury bonds ― DL News
- Coinbase Is Being Extorted. What Does That Mean for Its Stock? ― Unchained
- Top 5 crypto sectors making gains — Milk Road
- Strategy director offloads $5.2m of company stock amid massive share price rally ― DL News
Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.
