Loading article…
Ripple CEO Brad Garlinghouse says the 2020 SEC suit pushed the firm to consider dissolving and handing out all XRP, spending $150 million on legal defence.
Ripple’s chief executive disclosed that the December 2020 SEC lawsuit drove Ripple to the brink of shutting down, with a plan to distribute its entire XRP holdings to shareholders before ultimately fighting the case [1]. The revelation underscores the existential risk the regulatory action posed to one of crypto’s most prominent firms and explains why the company’s recent legal wins matter to investors and the broader market.
| At a glance | |
|---|---|
| Legal cost | ~$150 million spent defending the SEC case [2] |
| Shutdown plan | Considered dissolving Ripple and handing out all XRP [1] |
| Recent catalyst | XRP jersey patch deal with Kansas Jayhawks announced [1] |
| 2023 ruling impact | XRP price jumped ~96% on the day of the split decision [1] |
When the SEC filed its complaint in December 2020, major U.S. exchanges delisted XRP and the token’s price plunged, prompting internal talks of winding down the business and distributing the token pro‑rata to shareholders [1][2]. Garlinghouse said the plan was on the table because the agency’s “infinite power and resources” made the fight seem unwinnable. Ultimately, the company chose to continue operating to protect the hundreds of jobs it had created and to preserve its broader payments platform [1].
In July 2023, Judge Analisa Torres issued a split ruling that exempted programmatic XRP sales from securities classification, sending XRP up as much as 96% that day before settling lower [1]. By 2025 the SEC withdrew its appeal, leaving the original $125 million civil penalty largely intact but allowing Ripple to move forward [1]. The ruling cleared a major regulatory cloud, enabling institutions to re‑engage with XRP and paving the way for Ripple’s recent partnership with the Kansas Jayhawks, which made XRP the first cryptocurrency featured on a major U.S. college jersey [1].
The disclosure that Ripple once contemplated a complete shutdown highlights how regulatory pressure can threaten even well‑funded crypto firms. Whether the company can now embed itself in the U.S. financial system while keeping XRP’s demand steady remains an open question.
Coverage is mostly measured — 124 of 135 reports stay neutral.
Every Monday — the token unlocks, Fed dates & catalysts set to move crypto and markets this week. So you’re never blindsided.
Free · 3-min read · one-click unsubscribe
AI-assisted synthesis by the TrendWatcher Editorial Desk · sourced from 2 outlets · Jul 19, 2026 · How we report
The interview indicates the XRP reserve provided an escape hatch if the company shut down, but does not state it directly funded the defense.
Ripple secured full MiCA licensing in Europe, allowing it to offer payment products in 30 European countries, and may benefit from the U.S. Digital Asset Market Clarity Act if enacted.
Over the past year, XRP’s token price has fallen about 50%, whereas Ripple’s private company valuation has risen more than 50%.
Ripple USD, being a stablecoin pegged to the U.S. dollar, is less volatile and could cannibalize cross‑border transfers that previously relied on XRP.
The lawsuit concluded with a $125.04 million civil penalty and an injunction against Ripple, but the court ruled that XRP was not an unlicensed security when sold to retail investors.