Will the SEC's June 16 Update Shape the Future Trajectory of XRP Price and Ripple's Legal Standing?

With the SEC expected to file a court update by June 16, this week could shape the future trajectory of both Ripple's legal standing and XRP price performance.

The U.S. Court of Appeals is expecting an update from the Securities and Exchange Commission (SEC) by June 16 on the progress of its potential settlement with Ripple. This procedural development could be pivotal in determining whether the XRP lawsuit is moving toward resolution or faces further delay.

The SEC’s status report is a crucial milestone in the ongoing case, which could have a significant impact on institutional interest, exchange-traded fund (ETF) momentum, and broader regulatory clarity for XRP.

Earlier this month, Judge Analisa Torres of the U.S. District Court rejected a joint motion from the SEC and Ripple to stay the administrative steps pending appeal. The parties had attempted to file the motion improperly under Rule 62.1 of the Federal Rules of Civil Procedure, which led to the judge's decision.

However, legal experts, including attorney Fred Rispoli, point out that both parties still have the option to submit a revised motion for stay of administrative steps and administrative action. This time, they would file it under Federal Rule of Civil Procedure 60 to modify the existing judgment or order.

"If they file the Rule 60 motion to modify judgment by Monday, June 16, it would buy both parties an additional 60 days to prepare their next status report," Rispoli noted in a recent post on X.

But in a surprising turn of events, Judge Torres has granted permission to both the SEC and Ripple to pursue an appeal of her prior ruling. This decision came after both parties expressed their intent to appeal specific aspects of the judge’s decision in March.

The judge’s ruling on March 15 had largely sided with Ripple in key parts of the case. Specifically, the judge ruled that the SEC failed to sufficiently demonstrate that portions of Ripple’s institutional sales of XRP constituted "offerings," as defined by Section 4(6) of the Securities Act of 1933.

However, the judge also found that the SEC did manage to prove that portions of Ripple’s sales to retail investors were part of an ongoing "offering" and were sold in violation of Section 5 of the Act.

Despite this victory for Ripple, the crypto firm is still largely unable to pursue a U.S.-based initial public offering (IPO) or other capital-raising activities due to the ongoing injunction. This injunction was imposed on the SEC in December 2022 to prevent the agency from taking any actions to interfere with Ripple’s fundraising activities.

Moreover, the judge’s administrative ruling also impacts the potential approval of an XRP ETF by the SEC.

But could a new Rule 60 motion be pivotal in shifting the tide of the lawsuit?

According to legal experts, a filing under Rule 60 appears to be Ripple’s strongest remaining option for seeking relief. This is especially pertinent considering that the judge’s earlier decision on April 27 closed the door on a Rule 62.1 motion.

Earlier this month, Judge Torres also shot down a joint motion from the SEC and Ripple to stay the administrative steps pending appeal. The parties had attempted to file the motion improperly, leading to the judge’s decision.

However, legal experts suggest that both parties still have the opportunity to submit a revised motion for stay of administrative steps and administrative action. This time, they would file it under Federal Rule of Civil Procedure 60 to modify the existing judgment or order.

"If they file the Rule 60 motion to modify judgment by Monday, June 16, it would buy both parties an additional 60 days to prepare their next status report," Rispoli stated.

This pressing deadline arises from a previous ruling by the U.S. Court of Appeals for the Ninth Circuit. The court instructed the lower court to provide an update on the progress of any settlement endeavor or other material developments in the case by June 16.

In anticipation of this deadline, legal experts are speculating that the SEC and Ripple may cooperate to file a Rule 60 motion. This motion would aim to modify the existing judgment in order to factor in the administrative steps that need to be stayed.

However, Rispoli noted that the chances of reaching a settlement before June 16 are slim. He explained that if a settlement is reached, it usually happens in the final stages of the case. In this instance, both parties would need to agree on the terms of the administrative steps to be stayed.

"My view is that, in the absence of an agreed-upon motion, the SEC would likely file a motion to stay administrative steps, while Ripple would likely file a motion to modify judgment," Rispoli added.

Discussing the possibility of the SEC and Ripple reaching an out-of-court settlement, former SEC attorney James Farrell highlighted the importance of this step. He noted that Ripple could remain barred from public listing for at least four years unless the agency agrees to discontinue its appeal of the lower court’s decision