The XRP community is marking July 13 as “XRP Victory Day,” three years after Judge Analisa Torres issued a split summary judgment in the SEC’s case against Ripple.
Summary
- Ripple’s 2023 ruling protected programmatic XRP sales while leaving institutional transactions subject to securities law.
- The SEC case ended in 2025 with a $125 million penalty and permanent injunction intact.
- Ripple leaders now say the company considered closing before choosing an expensive multiyear legal defense.
The 2023 order rejected the regulator’s claim that every XRP transaction followed the same legal pattern. It also gave public exchange sales a different outcome from direct institutional deals. The SEC had accused Ripple and two executives of conducting unregistered securities offerings through years of XRP sales and distributions across several channels.
The court did not issue a blanket ruling that every future XRP sale falls outside securities law. Torres wrote that XRP, as a token, was not “in and of itself” an investment contract. She then examined how Ripple offered and sold the asset in separate transaction categories under the Howey test.
Exchange and institutional sales received different outcomes
Ripple’s programmatic sales on exchanges did not qualify as investment contracts, the court found. Those trades used blind bid-and-ask systems. Buyers did not know whether Ripple or another holder sold the XRP. The record therefore failed to show that those buyers reasonably expected profits from Ripple’s work.
The decision went the other way for about $728.9 million in institutional sales. Ripple sold those tokens through written agreements to sophisticated buyers. The court found that the contracts, marketing and use of proceeds created an expectation that Ripple’s work could raise XRP’s value. It ruled that those sales violated registration rules.
Ripple says the lawsuit nearly forced a shutdown
Recent comments from Ripple executives have added new detail about the pressure surrounding the case. Chief executive Brad Garlinghouse said the company “almost decided to shut down” after the SEC filed its complaint in December 2020. He described the government’s resources as a major concern during internal talks.
Ripple co-founder David Schwartz said some lawyers considered the company “unsavable” and advised executives to seek personal settlements. Those comments describe private discussions and legal advice; they do not prove the SEC intended to close Ripple. As crypto.news reported, Ripple instead continued operating and spent about $150 million on its defense.
Final judgment stayed in place after appeals ended
The July 2023 order did not end the lawsuit. The court later imposed a $125.04 million civil penalty and a permanent injunction tied to future unregistered institutional sales. That amount was far below the SEC’s requested remedies, but it confirmed that Ripple had violated federal securities law in one part of its XRP business.
Ripple and the SEC tried to reduce the penalty to $50 million and remove the injunction in 2025. Torres rejected their joint request, saying they had not shown grounds to change the final judgment. Both sides later dismissed their appeals, and the case formally ended in August 2025.
As previously reported, the final outcome left a transaction-based framework. Public exchange sales received more favorable treatment, while direct institutional sales remained restricted. The decision also removed the pending personal claims against Garlinghouse and executive chairman Chris Larsen after the SEC dismissed them in 2023.
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