News: Ripple-SEC Lawsuit As SEC Commissioner Opposes Move

Key Insights:

• SEC officially filed for a $50M settlement with Ripple over XRP lawsuit.
• Remaining escrow funds were released with a joint agreement filed with Judge Torres.
• SEC Commissioner Caroline Crenshaw put out a statement opposing the settlement between SEC & Ripple.

The Ripple-SEC lawsuit continues to get new developments with decision considered to also affect the approval of XRP ETFs.

Ripple-SEC Lawsuit Updates

Following years of court squabbles, SEC and Ripple had reached a record settlement, filing for a $50 Million deal that downgrades the former’s proposed fine of $125 Million.

The May 8, 2025 joint filing asked Judge Analisa Torres for an indicative ruling to (a) lift the injunction from the Final Judgment and (b) release the escrowed civil penalty funds.

According to the agreement, the SEC will get the full $50 Million payment, and Ripple will be credited with the remaining escrow monies.

This would be the end of a lengthy lawsuit that began with SEC’s claim that Ripple had sold unregistered securities.

The August 7, 2024 entry, Final Judgment, included the civil penalty and injunction, but these were to be vacated.

The parties plan to argue for limited remand to the United States if Judge Torres makes the suggested finding.

After the resolution, XRP will no longer be bound by law, and now would be a critical turning point for Ripple and the entire cryptocurrency sector.

New Announcement as SEC Commissioner Opposes Move

Meanwhile, Caroline A. Crenshaw, the SEC Commissioner, chose not to follow the Ripple settlement. Surprisingly, released she dissenting statement opposing the arrangement between the SEC and Ripple Labs.

Crenshaw asserted that the agreement had effectively undermined those of judicial powers, dressing it up as “severe injustice to the interests of investors”.

Crenshaw reported that the settlement revoked former enforcement results, including the civil penalty and injunction, and did not bind Ripple to remedy possible future violations.

Crenshaw pointed out that with the agreement, it would be impossible for the Commission to take action if Ripple began selling unregistered XRP to institutions again.

From her perspective, such move would rescind the court’s earlier ruling and smash decades of agonizing legal advancement.

Her remarks clearly indicated a major disdain for the present flight path of the SEC under a new leadership, which moves away from the more rigorous regulatory model of Chairman Gensler.

Besides, SEC made its official announcement on May 8 2025, describing the confirmation of the civil enforcement settlement by Ripple and its executives Bradley Garlinghouse and Christian Larsen.

The dissent expressed by Commissioner Crenshaw called to attention divisions within the previously crypto-hostile agency.

Now under the leadership of crypto-friendly chair Paul Atkins, could lead to changes in regulations of digital assets in the future.

Ripple CTO on ZK Proofs

According to David Schwartz, zk proofs have the potential to revolutionize the blockchain industry, as stated by ripple CTO David Schwartz.

When Schwartz looked back on the architecture of the XRP Ledger, he emphasized how the ZK technology may lead to increased scalability and privacy.

Using zero-knowledge proofs, people can confirm the legitimacy of information without revealing their information, and this is very beneficial for things such as a confirmation of identity and private agreements.

This view was aligned with the broader trend in the industry where ZK-rollups, as used on Ethereum and other Layer-2s, have made performances ten times better and cut fees by 99%.

Such concepts were in practice with projects like zkSync, StarkNet and Polygon zkEVM.

Deploying zero-knowledge solutions in public blockchains is, however, extremely challenging: enormous demand for computation and steep learning curves for developers.

With the support of Schwartz, Ripple’s intentions to introduce ZK technologies can and likely will lead to more XRP-based infrastructure. It is still unclear at this point what the potential range for ZK adoption is.