The XRP community has closely watched recent developments as speculation grows about Ripple’s ongoing legal battle. According to a post on X (formerly Twitter) by Vincent Van Code, Ripple Labs may be negotiating with the U.S. Second Circuit Court to challenge the ruling that deemed direct XRP sales as securities.
This move could have significant implications for both Ripple and the broader cryptocurrency industry if confirmed. This legal effort is crucial for Ripple to clarify its regulatory standing and ensure smoother distribution of XRP within its network.
While some reports suggest that negotiations are ongoing, no official confirmation from Ripple or the court has been confirmed. The case stems from a ruling by Judge Analisa Torres, which determined that Ripple’s institutional sales of XRP constituted unregistered securities transactions.
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If the appeal is accepted and the verdict overturned, Ripple could have a more flexible legal framework for XRP distribution. However, legal experts believe the appeal process may be complex, and its outcome remains uncertain.
I believe the #Ripple case is being negotiated with the Second circuit courts.
Ripple might be trying to unwind the “direct sales are securities” ruling so it makes it more streamlined for them to distribute XRP to their network participants as part of RippleNet.
Further, in…
— Vincent Van Code (@vincent_vancode) March 4, 2025
Potential Strategic Moves in Ripple’s Legal Battle
Market observers suggest Ripple’s motivation for this legal move extends beyond regulatory concerns. One key aspect of the case is the impact on RippleNet, as an overturned ruling could eliminate legal obstacles in XRP’s distribution to financial institutions and other participants.
Additionally, there are speculations that Ripple’s legal strategy could involve selling its XRP escrow holdings to the U.S. government.
Such a move would require XRP to be free from securities classification, reinforcing the need for Ripple to challenge the existing ruling. The escrow, which releases one billion XRP monthly, remains central to Ripple’s financial operations and long-term plans.
Ripple also faces a $125 million penalty in the case. Analysts believe the company could settle this fine using XRP rather than fiat currency if the injunction limiting Ripple XRP sales is lifted by the court.
At this stage, Ripple remains engaged in the legal process, with industry stakeholders closely monitoring any further updates from the court or company officials.
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