The SEC backing down from its Ripple appeal could be the seismic shift crypto has been waiting for, igniting speculation that the agency’s crackdown is collapsing.
**SEC’s Retreat Signals a Major Shift in Crypto Regulation**
The U.S. Securities and Exchange Commission (SEC) is on the verge of a major retreat in its legal battle against Ripple, according to former SEC official John Reed Stark. The founder and chief of the SEC’s Office of Internet Enforcement for 11 years believes the agency will abandon its appeal, marking a pivotal moment in crypto regulation. He reiterated his stance on social media platform X this week:
In my opinion, the SEC will never again file a pleading in a court case advocating that any digital asset is a security. That is the reason why a withdrawal of the SEC’s Ripple appeal is inevitable.
Stark added: “I also believe that the SEC will win the Ripple appeal, and such a victory would be wholly inconsistent with its current crypto–ethos.” His comments suggest that while the SEC could succeed in court, it may no longer have the appetite for a prolonged fight against Ripple.
Beyond Ripple, Stark pointed to broader cracks forming in the SEC’s crypto enforcement approach, highlighting recent cases that were quietly dropped. With high-profile investigations into Uniswap and Opensea officially shut down, speculation is growing that the SEC is pulling back from its previously aggressive stance on digital assets. If Stark’s prediction holds true, Ripple’s victory could signal a larger shift in how crypto firms are treated by U.S. regulators.
“So this is how the SEC dies,” the former SEC enforcement chief opined in another X post. “The rapid-fire demolition of the SEC crypto-enforcement program continues. SEC investigations of Uniswap & Opensea officially closed. Both firms had received wells notices under SEC Chair [Gary] Gensler.” He added:
Dropping of the SEC’s Ripple appeal next up for sure.
The agency recently moved to dismiss its lawsuit against Coinbase, which had been accused of operating as an unregistered securities exchange. Additionally, the SEC has concluded its investigation into Robinhood’s crypto operations without pursuing enforcement action, suggesting a more lenient regulatory stance. This trend signals a broader move under the current administration to foster innovation within the cryptocurrency sector by easing regulatory pressures—a shift that could have major implications for Ripple and the wider industry.
