XRP News Today: XRP Price Dips as Judge Rejects Ripple’s $50M SEC Settlement Amid $160M Token Exodus

Ripple’s long-standing legal battle with the U.S. Securities and Exchange Commission (SEC) took another twist on May 16, 2025, after U.S. District Judge Analisa Torres rejected a proposed $50 million settlement between the two parties.

The ruling triggered a sharp downturn in XRP price, eroding recent gains and sparking a wave of cautious repositioning among traders.

Judge Rejects Ripple’s $50M Deal with SEC

Judge Torres dismissed the joint request from Ripple and the SEC, stating it was “procedurally improper” and outside her jurisdiction, as the case is currently under appeal. “Even if jurisdiction existed, the motion failed to justify the relief requested,” she added, delivering a significant procedural blow to both sides.

Judge Torres rejected the SEC and Ripple’s joint motion as “procedurally improper,” saying she’d deny it even with proper jurisdiction. Source: James K. Filan via X

The lawsuit, initially filed in December 2020, accused Ripple of raising $1.3 billion through unregistered XRP sales. Though the case has seen partial rulings favorable to Ripple, including a 2023 decision that declared XRP is not a security when sold on public exchanges, the final resolution remains elusive.

Market Responds with $160M in Derivatives Withdrawals

The latest court development had an immediate impact on the Ripple crypto market. Following the ruling, XRP value dipped over 6% to $2.37, down from a weekly high above $2.60. Analysts note that this reversal erased most of the price gains made after the May 8 announcement of a potential settlement.

According to data from Coinglass and Coingecko, XRP derivatives markets reacted swiftly, with over $160 million in open interest pulled within a 24-hour window. This 3.29% decline signals that many traders are de-risking their positions, anticipating prolonged legal proceedings and regulatory ambiguity.

The majority of these liquidations—more than $13.5 million—were long positions, underscoring the market’s bearish tilt. Meanwhile, XRP options market activity also declined dramatically, with open interest plummeting over 76% to $254,000, despite a brief spike in volume.

Ripple’s Legal Team Remains Optimistic

Despite the procedural setback, Ripple is not backing down. Stuart Alderoty, Ripple’s Chief Legal Officer, emphasized that the ruling does not negate Ripple’s earlier legal victories. “Nothing in today’s order changes Ripple’s wins,” he said, noting that the rejection was based purely on procedural grounds regarding the dismissal of Ripple’s cross-appeal.

Ripple says the order doesn’t affect its legal wins, calling it a procedural issue, and confirms both parties will revisit the case together. Source: Stuart Alderoty via X

He added that Ripple and the SEC remain aligned in their intention to resolve the dispute, and both plan to refile a corrected motion. “Ripple and the SEC are fully in agreement to resolve this case and will revisit this issue with the Court, together,” Alderoty wrote on X (formerly Twitter).

Broader Implications for XRP Lawsuit and Crypto Regulation

Legal experts believe this decision could delay the final resolution of the XRP SEC lawsuit by several months. Crypto attorney John Deaton called the ruling a “curveball,” suggesting the judge may be pushing back against attempts to fast-track the conclusion. “This is the judge saying to the SEC and Ripple, ‘I’m not rubber-stamping anything. Convince me,’” Deaton said.

He added that future filings would likely need to account for broader legal standards and public interest, rather than simply presenting an agreement between the parties.

The case remains a pivotal moment in the evolving regulatory landscape for crypto assets. While SEC enforcement actions have softened under Trump-appointed Chair Paul Atkins, the Ripple lawsuit remains a focal point in defining how U.S. securities laws apply to digital assets.

What’s Next for XRP Price?

The rejected settlement has introduced fresh uncertainty into XRP price predictions for 2025. While some analysts previously forecast a potential rally to $9 or higher, the near-term outlook now appears clouded by legal delays and bearish sentiment.

XRP was trading at around $2.37, down 1.89% in the last 24 hours at press time. Source: XRP Liquid Index (XRPLX) via Brave New Coin

With the $2.30–$2.40 zone serving as a temporary support, market participants will be watching closely to see whether XRP can stabilize or dip further. According to traders, a failure to hold above the $2 mark could trigger deeper consolidation or even a short-term correction.

Additionally, the XRP/BTC ratio fell 5.3% on May 16, suggesting XRP may underperform compared to Bitcoin and Ethereum if the broader crypto rally continues without regulatory clarity for Ripple.

Final Thoughts

The procedural rejection of Ripple’s $50 million settlement bid has reignited legal uncertainty at a time when many believed the XRP lawsuit update signaled an imminent conclusion. While the court’s response did not alter existing rulings in favor of Ripple, it has delayed closure and sparked a defensive stance among traders.

As Ripple and the SEC prepare to return with a revised motion, investors and the broader crypto community will be keeping a close eye on how this defining case unfolds—and what it means for the future of Ripple XRP news and regulatory precedent across the industry.