SEC sues Ripple

On December 22, 2020 the SEC sued Ripple Labs and two executives, co founder Chris Larsen and CEO Brad Garlinghouse, in federal court in Manhattan (case 1:20-cv-10832). The agency said Ripple had raised more than 1.3 billion dollars since 2013 through sales of XRP that should have been registered as securities offerings.

Ripple argued XRP was a currency, not an investment contract, and that the SEC had given no fair warning. The case became the biggest test of how US securities law applies to a crypto asset.

The market reaction was swift. Several US exchanges, including Coinbase, announced they would suspend or delist XRP trading, and the price dropped by more than half within about a week. Our chart shows the closes around those dates.

The case ran for almost five years. Read the full XRP vs SEC explainer for the July 2023 ruling, the penalty and how it ended.