SEC Commissioner Crenshaw Slams Ripple Deal, Agency Direction Under Trump

SEC Commissioner Caroline Crenshaw has publicly denounced the agency’s recent settlement with Ripple Labs, warning it marks a retreat from meaningful crypto enforcement and leaves investors exposed.

“This settlement, alongside the programmatic disassembly of the SEC’s crypto enforcement program, does a tremendous disservice to the investing public and undermines the court’s role in interpreting our securities laws,” Crenshaw said in a statement following the announcement.

On Thursday, the Securities and Exchange Commission said Ripple and its two top executives would pay $50 million to resolve the case, first filed in 2020 under then-Chair Jay Clayton.

 The SEC had initially alleged that Ripple raised capital through the unregistered sale of XRP tokens and deprived investors of key disclosures.

The case was a cornerstone of the agency’s crypto crackdown during Gary Gensler’s tenure, which saw action against major digital asset firms. 

It was later determined by the courts that Ripple had violated securities laws in relation to institutional sales of XRP, but not in its programmatic sales to retail investors. 

While the SEC initially sought a $2 billion penalty, a judge ultimately ordered Ripple to pay $125 million in civil penalties last year.

Thursday’s deal vacates that penalty, returning over $75 million held in escrow to Ripple and lifting a prior injunction. Ripple and two of its executives, CEO Brad Garlinghouse and Executive Chairman Chris Larsen, will pay $50 million to settle the case.

The SEC’s shifting stance on crypto

Crenshaw’s term as commissioner ended in 2024, but the SEC allows for an 18-month extension after a term expires. 

She expressed alarm over what she described as a “programmatic shift” in the SEC’s stance on crypto.

Since President Donald Trump returned to office, the agency has dropped multiple crypto cases and signaled a friendlier approach to digital assets.

“[The settlement] subverts the clear and honest application of the facts to the law,” Crenshaw said.

She argued the agency was abandoning wins already achieved in court in exchange for hypothetical future rule changes that remain undefined.

“We are today accepting a diluted settlement that erases the investor protections we already won, based on a non-existent framework that may or may not come to fruition potentially years from now,” she said.

She also warned the move damages the SEC’s credibility, noting its lawyers “are being asked to take legal positions today contrary to the ones taken just months ago.”

Crenshaw has long been a skeptic of crypto and previously dissented against the agency’s January approval of spot Bitcoin ETFs. But her latest remarks underscore the growing tension inside the SEC over its direction in a rapidly changing regulatory environment.

XRP, Ripple’s native token, remains one of the largest cryptocurrencies, with a market cap of over $132 billion. It is currently up 6.5% on the day to $2.31, CoinGecko data shows.

Edited by Sebastian Sinclair