The United States’ Securities and Exchange Commission (SEC) announced on Wednesday that it is dropping a yearslong case against Ripple Labs, a cryptocurrency firm associated with the White House.
“Today is a victory — and a long overdue surrender by the SEC,” CEO Brad Garlinghouse said. This move allows Ripple to avoid potentially facing a $125 million fine, and comes shortly after Garlinghouse was at the White House for President Donald Trump’s Crypto Summit. According to ABC news, Garlinghouse also donated $5 million to Trump’s inaugural committee. Garlinghouse had also posted a photo with Trump on social media.
The SEC’s case had been going on for over four years. In December 2020 — while Trump was still in office during his first presidency — the SEC sued Ripple and two executives for violating securities laws when they raised $1.4 billion through the sale of XRP crypto tokens. In 2023, a federal judge ruled that the publicly sold tokens did not constitute a security, though Ripple was fined $125 million because the tokens should have been sold to institutional investors. The SEC had appealed that ruling. Ripple’s appeal of the $125 million fine was still pending as of Wednesday.
READ: SEC launches new task force to tackle crypto regulations under Trump (January 22, 2025)
“Thankfully, we have new leadership in the executive and legislative branches of our government,” he said. “That leadership is actively seeking a rational and constructive way forward on crypto. Let’s make the most of this,” Garlinghouse said in a statement on X.
Garlinghouse also wrote, “An incredible THANK YOU to @realdonaldtrump for opening and welcoming us to the White House (amazing contrast to the hostility of the Biden administration) … for hosting us at the CFTC!” after he attended the White House Crypto Summit, showing his support for the Trump administration.
Ripple is not the only cryptocurrency firm with ties to the Trump administration. Trump also has ties to Tether, a controversial stablecoin issuer, through Commerce Secretary Howard Lutnick. Lutnick’s former firm, Cantor Fitzgerald, is the primary banking partner for Tether. Tether’s token of the same name is by far the most heavily traded digital asset.
Trump’s ties to cryptocurrency firms caused some concern when he included crypto in his strategic reserve as he signed an executive order to establish a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile on March 6.