The painfully long-standing legal battle between the US Securities and Exchange Commission (SEC) and Ripple Labs, which began in December 2020, appears to be approaching a critical juncture.
Recent developments suggest that the case, centered on whether XRP constitutes an unregistered security, could finally conclude, with potential implications for XRP’s classification and market trajectory.
As settlement talks intensify and regulatory shifts emerge under the Trump Administration, the crypto community anticipates announcements that could redefine XRP’s role in the digital assets landscape.
According to various media reports, the SEC is now said to be considering classifying XRP as a commodity rather than a security, a major shift that could resolve the four-year dispute.
This speculation gained traction following a July 2023 ruling by U.S. District Judge Analisa Torres, who determined that XRP is not a security when sold on secondary markets, though institutional sales violated securities laws, resulting in a $125 million fine for Ripple.
The SEC appealed this decision in October 2024, but under new leadership—following Gary Gensler’s resignation and departure in January 2025 and Mark Uyeda’s appointment as acting chair—the agency’s stance appears to be softening.
Sources indicate that settlement negotiations are weighing XRP’s utility and trading patterns, drawing comparisons to Ethereum (ETH), which the SEC treats as a commodity despite its initial coin offering (ICO). But it’s also worth noting that ETH is far more decentralized, despite its transition from proof of work (PoW) to proof of stake (PoS) consensus.
It can also be argued that Ethereum is by far the most decentralized smart contract platform and is only behind Bitcoin (BTC) when it comes to adoption and adequate levels of decentralization. Meanwhile, XRP is not sufficiently decentralized when compared to the much larger BTC and ETH networks.
Crypto lawyer John Deaton, a Ripple supporter, recently criticized the SEC’s inconsistent approach towards XRP and Cardano (ADA).
He argued that the agency’s acknowledgment of XRP exchange-traded fund (ETF) filings—similar to those for Bitcoin and Ethereum—implicitly validates XRP as a commodity, yet the SEC has not formally clarified its position.
Deaton suggested that a pro-crypto administration and Uyeda’s leadership could pressure the SEC to drop its appeal or settle, potentially lifting the injunction on Ripple’s institutional sales.
This aligns with reports that the case is now finally nearing its end, with Ripple negotiating terms to mitigate the 2023 ruling’s restrictions.
At present, XRP’s market cap is at around $129 billion as of March 14, 2025, with potential for growth if the SEC reclassifies it as a commodity.
Crypto and web3 industry analysts predict that such a move could pave the way for spot XRP ETF approvals, a development Ripple Labs CEO Brad Garlinghouse referred to as “inevitable” in February 2025.
This sentiment is bolstered by the launch of BlocScale, which is said to be XRP’s first launchpad, which has gained traction during its seed sale, signaling community support and investor interest.
Expected announcements in 2025 hinge on the settlement’s outcome. If the SEC designates XRP a commodity, industry professionals anticipate a formal statement by mid-year, possibly alongside ETF approvals, driving XRP’s price toward $3-$5, or even higher, according to crypto analysts.
However, if negotiations falter (which is unlikely at this time given the mostly pro-crypto stance in the US), the appeal could extend into 2026, prolonging uncertainty.
With Ripple’s cross-border payment solutions gaining traction globally and institutional adoption rising, the resolution of this case could mark a turning point, not just for XRP but for broader crypto regulation in the U.S. And we can already see this happening in a major way with the new Trump administration.
For now, all eyes remain on the SEC’s next move. Ripple Labs and its executive team have come a long way and have shown their resilience. The executive team claims they have spent over $100 million in legal fees over the years and are now focused on making meaningful contributions to the web3 space.
But XRP price still remains below its 2018 all-time high and could potentially surge if several pending ETFs products are finally approved by US regulations.