Just one day after the years-long lawsuit between the U.S. Securities and Exchange Commission (SEC) and Ripple concluded, the regulator made a notable decision on August 8, 2025: to exempt Ripple from the "loss of status" penalty imposed by the previous ruling.

This decision means that Ripple can now raise funds from institutional investors, which was prohibited by the final ruling in August 2024.

Context of the SEC – Ripple Case

In December 2020, the SEC sued Ripple, alleging that the company raised over $1.3 billion through the sale of XRP as unregistered securities. Ripple countered that XRP is a digital currency, not a security.

In July 2023, Judge Analisa Torres ruled:

  • Ripple's sale of XRP in the form of "market sales" to retail investors did not violate securities laws.

  • However, selling XRP directly to institutional clients violated securities laws.

Final Ruling and Injunction

In August 2024, the court issued a final ruling, requiring Ripple to pay a fine of over $125 million and cease all violations of securities laws. This injunction includes a prohibition on raising funds from institutions through the sale of XRP.

When the ruling takes effect, Ripple will also lose its "status" under Rule 506(d) of the Securities Act – a regulation that automatically deprives the company of the ability to use certain fundraising exemptions without registration with the SEC.

New Turning Point: SEC Grants Ripple 'Passport'

On August 8, 2025, the SEC officially exempted Ripple from the loss of status under Rule 506(d). This allows the company to:

  • Continue fundraising from accredited investors.

  • Utilize theexemption under Regulation Dwithout needing to register the issuance with the SEC.

This is seen as an important signal, paving the way for Ripple to regain access to institutional capital – a factor that has played a significant role in the company’s growth strategy.

Market Reaction

Immediately following this news, the price of XRP rose by 6.5% on the day, reaching $3.31 – reflecting investor optimism about Ripple's new prospects.