Second Circuit Pauses SEC-Ripple Appeals on April 16, 2025

The U.S. Court of Appeals for the Second Circuit granted a joint request from the Securities and Exchange Commission and Ripple Labs on April 16, 2025, placing their appeal and cross-appeal on hold while the parties pursued a negotiated resolution of the regulator’s long-running XRP enforcement case.

Circuit Judge José A. Cabranes approved the motion in docket numbers 24-2648 and 24-2705. The one-page order directed the SEC to submit a status report within 60 days. It did not dismiss either appeal, approve a settlement or change the underlying district-court judgment.

That distinction mattered. By April 16, the parties had disclosed an agreement in principle, subject to approval by the Commission, but they had not completed the procedural steps needed to end the litigation. The court’s order suspended the appellate timetable and replaced Ripple’s expected briefing deadline with a waiting period.

The dispute reaching the appellate court

The SEC sued Ripple, Bradley Garlinghouse and Christian Larsen on December 22, 2020, alleging violations of the registration provisions of the federal securities laws involving offers and sales of XRP.

On July 13, 2023, U.S. District Judge Analisa Torres issued a divided summary-judgment ruling. The court concluded that Ripple’s institutional sales constituted offers and sales of investment contracts, while its programmatic sales through digital-asset exchanges did not constitute investment contracts on the record before the court. The decision turned on the circumstances of the transactions under the Howey test; it did not announce that every transaction involving XRP was outside securities law.

The district court entered final judgment on August 7, 2024, including an injunction and a civil penalty of $125,035,150. The SEC filed a notice of appeal on October 2, 2024, and Ripple filed its cross-appeal on October 10. The SEC submitted its opening appellate brief on January 15, 2025.

The appeals therefore presented a route for the Second Circuit to review parts of a district-court decision that had become influential in arguments over how securities law applied to token distributions and exchange-based transactions.

What the April 16 order changed

The verified action on April 16 was procedural but consequential: active appellate litigation stopped. The parties’ April 10 request said they had reached an agreement in principle covering the underlying case, the SEC’s appeal and Ripple’s cross-appeal, subject to Commission approval. They argued that an abeyance would conserve judicial and party resources while they pursued that resolution.

Granting the request meant the Second Circuit would not immediately receive Ripple’s responsive and cross-appeal briefing or move the dispute toward argument and decision. For Ripple, the SEC and other digital-asset businesses watching the litigation, that reduced the immediate prospect of an appellate ruling that could either affirm, narrow or reject the district court’s transaction-specific analysis.

The order did not create binding new law about XRP or other tokens. It also did not erase the August 7, 2024 judgment. As of April 16, 2025, the injunction and civil penalty remained part of the district-court record, and the proposed resolution still required additional approvals and court proceedings.

Institutional significance and uncertainty

The pause illustrated how a change in enforcement posture could affect crypto policy without a new statute or appellate precedent. An agency decision to negotiate could halt a major test case, but private settlement discussions could not themselves amend a federal judgment.

No market-price claim is made here. The court order establishes the legal event, but the selected records do not provide a common XRP venue, timestamp or event window sufficient to isolate a price response from broader market movement.

Later context

On May 8, 2025, the SEC publicly announced a formal settlement framework and described additional steps the parties intended to seek from the courts. That later announcement confirms the direction of the April negotiations, but it was not known as an approved settlement when the Second Circuit issued its April 16 order.