The legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) is moving toward a critical juncture, but a final resolution could still take several more months.
Crypto legal expert James Farrell has provided insight into the ongoing process, noting that the current developments are unfolding on a longer timeline.
Current court proceedings remain suspended as both Ripple and the SEC focus on two major legal matters. These include a possible full case settlement and a separate request for an indicative ruling that could reshape Ripple’s future operations.
Ripple is now seeking what is known as an “indicative ruling” from Judge Analisa Torres. If granted, the ruling would allow the judge to revise her prior decision to enable Ripple to carry out private sales of XRP under certain legal exemptions. These exemptions are typically off-limits to entities found in violation of securities laws.
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Ripple’s push for this ruling is tied closely to its plans for a potential Initial Public Offering. Without the change in judgment, the company’s path to going public remains blocked for at least the next few years.
Key Legal Scenarios Could Define Ripple’s Next Steps
Farrell explained that Ripple will first need to submit a formal settlement offer to the SEC Commissioners for approval. As of last week, there is no confirmation on whether the offer has been submitted or when it may be reviewed.
Ripple’s lawyer explained to the SEC two possible futures that would depend on their handling of the company’s dual requests. When the SEC approves the settlement without accepting the indicative ruling separately, Ripple remains without definite regulatory guidance.
The appeal dismissal would occur without regulatory clarity for Ripple, as the court would require several months to decide the motion to modify the injunction under Judge Torres.
In such a scenario, Ripple would remain a private company with limited options while it waits for Judge Torres to make a ruling, which could take three to six months. Ripple cannot predict that the judge will validate their requested change since she shows no promise of approval unless fundamental case details transform.
Alternatively, if the SEC views both the settlement and the indicative ruling as linked requests, rejecting either would likely restart the appeals process. The scenario would result in delayed proceedings since appellate court arguments would begin in early 2026, and a possible ruling would extend into the third quarter of 2026.
The uncertainty around whether the SEC will treat the two legal paths independently or as one package adds to the complexity. Any delays in internal SEC decision-making or additional court procedures could push the case even further into the future.
Conclusion
Ripple’s legal position and future business strategy continue to hinge on decisions that are still in motion. While talks appear to be advancing, legal procedures and regulatory hurdles may keep the case active for several more months.
The outcome will not only impact Ripple’s operations but could also influence broader industry expectations for regulatory clarity in the U.S. crypto market.
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