The U.S. Securities and Exchange Commission (SEC) has officially filed the settlement agreement letter in its legal dispute with Ripple Labs

The filing was submitted to Judge Analisa Torres of the Southern District of New York, requesting her indicative ruling on a jointly proposed settlement.

The U.S. Securities and Exchange Commission (SEC) has formally filed the settlement agreement letter for its case with Ripple Labs, a major step toward closing the nearly five-year-old lawsuit.

The filing, submitted to Judge Analisa Torres of the Southern District of New York, requests her indicative ruling on a jointly proposed settlement.

As part of the agreement, Ripple will pay $50 million to the SEC. This is part of the originally imposed $125 million fine, with the remaining $75 million, held in escrow, set to be returned to Ripple once the court approves the dissolution of the previous injunction. Both parties have also agreed to withdraw their ongoing appeal and cross-appeal.

After Judge Torres indicates whether she agrees to dissolve the injunction and release the escrow, the case will be sent back to her court from the Second Circuit Court of Appeals for a limited remand. Upon return, Ripple and the SEC will jointly file a motion to formalize the dissolution of the injunction and redistribution of the funds. Afterward, both appeals will be dismissed, fully ending the case.

This legal process, mostly administrative at this stage, will formally conclude a case that began in December 2020. The SEC initially sued Ripple for allegedly conducting unregistered securities sales through its XRP token.

Following Donald Trump’s return to the presidency in late 2024, the SEC began dialing back on aggressive enforcement actions against crypto companies. In May 2025, the SEC has now dropped or settled many of the high-profile lawsuits from the Gensler era.

The agency has also applied to dissolve the court injunction imposed in December 2020, a move that will allow for the release of the $75 million escrowed funds to Ripple.

Moreover, the SEC has agreed to largely accept a ruling by Judge Analisa Torres, who oversaw the case. In March 2023, Judge Torres largely ruled in favor of the SEC, finding that Ripple had sold XRP to institutional investors in a manner that should have been registered with the SEC.

However, Judge Torres also ruled that the SEC failed to sufficiently notify institutional investors about the legal implications of their XRP purchases from Ripple.

This part of Judge Torres’s ruling was a setback for the SEC, as the agency had argued that it did not need to notify institutional investors.

After Judge Torres’s ruling, both parties planned to appeal to the Second Circuit Court of Appeals. However, they later announced that they had reached a tentative settlement agreement and would be applying to stay the appeals process.

The case then went into a period of quiet negotiation, with both parties aiming to finalize the agreement and have it approved by Judge Torres.

Finally, on May 9, 2025, the SEC filed the completed settlement agreement letter, signaling the final stage of this long-running legal dispute.

The filing marks a significant development, especially considering the broader implications for the crypto industry. A decisive ruling in favor of the SEC could set a strong precedent for future cases.