TLDR
- Ripple is unable to raise private funds due to a court injunction on institutional XRP sales.
- The court ruled in 2023 that Ripple violated securities laws by selling XRP to institutional investors.
- Ripple and the SEC have filed a joint motion to modify the final judgment and lift the injunction.
- Former SEC attorney Marc Fagel believes the injunction severely limits Ripple’s ability to secure institutional investments.
- Attorney Bill Morgan says institutional investors are awaiting legal clarity before engaging with Ripple.
Ripple continues to face obstacles in raising private capital due to a standing court injunction restricting institutional XRP sales. A joint motion filed by Ripple and the SEC seeks to dissolve this restriction, aiming to modify the final judgment. Legal analysts suggest the court’s response will significantly impact Ripple’s ability to compete in U.S. markets.
Court Injunction Hampers Ripple Capital Strategy
The permanent injunction blocks Ripple from selling XRP to institutional investors unless it complies with securities regulations. Judge Analisa Torres issued this ruling in 2023 after determining Ripple’s past institutional XRP sales breached U.S. securities laws. As Ripple pursues new funding channels, this ruling remains a critical barrier.
The legal team argues the injunction restricts Ripple’s ability to engage in standard private fundraising practices. They claim the inability to sell XRP under current terms disrupts capital inflow and corporate growth. Ripple maintains that the restrictions place it at a structural disadvantage in the digital asset space.
The parties submitted a joint motion requesting the court to lift the injunction and consider other case modifications. This move aims to resolve the legal dispute without advancing to appeals, which both sides seek to avoid. The timing of the motion suggests urgency in restoring Ripple’s financial flexibility.
Former SEC Attorney Cites Fundraising Risk
Former SEC lawyer Marc Fagel believes the injunction weakens Ripple’s capacity to attract institutional investors for private offerings. He asserts that any XRP sale under these terms now carries significant legal uncertainty, which discourages investor participation. According to Fagel, continued enforcement will hinder Ripple’s capital development initiatives.
The main issue with the injunction is it limits Ripple’s ability to raise financing in private offerings.
— Marc Fagel (@Marc_Fagel) June 17, 2025
Fagel emphasizes that lifting the injunction is essential for Ripple to resume standard business operations involving institutional transactions. Without this relief, Ripple cannot offer XRP in private placements without legal risk. This condition affects not only Ripple’s fundraising but also its business relationships.
His view aligns with concerns raised by others monitoring the proceedings, who argue the injunction deters long-term investment. The restriction disadvantages Ripple compared to firms with unrestricted access to institutional capital. Stakeholders await the court’s decision to determine Ripple’s next strategic moves.
Legal Experts Expect Impactful Ruling
Ripple and the SEC jointly filed a status report requesting a delay in appeal proceedings while seeking final resolution through modification. Legal experts believe the court may favor modifying the injunction to bring closure to the prolonged litigation. Such a decision would reset Ripple’s institutional engagement pathway.
Attorney Bill Morgan noted institutional investors seek legal clarity on XRP before committing to future acquisitions through Ripple. He pointed out that the injunction limits Ripple’s market participation and weakens its competitive edge. Dissolving the restriction would allow XRP to align with current regulatory expectations.
