Ripple has achieved a significant legal victory in the United States, with the dismissal of a long-standing lawsuit from XRP investors. On January 27, 2026, the United States Court of Appeals for the Ninth Circuit upheld a previous lower court decision in the case of Sostack v. Ripple Labs, effectively quashing class-action claims that asserted XRP was sold as an unregistered security.
The court determined that the lawsuit was filed too late under the Securities Act of 1933. According to the ruling, XRP was offered to the public starting in 2013, which initiated the legal time frame for filing claims. The plaintiffs, however, did not submit their lawsuit until 2018, with the lead plaintiff, Bradley Sostack, joining the case in 2019, well beyond the statutory deadline.
In its ruling, the court emphasized that the claims could not proceed irrespective of the arguments presented. The plaintiffs contended that Ripple”s releases of XRP in 2017 constituted a new securities offering, thereby resetting the legal clock. The appellate court dismissed this argument, stating that the fundamental nature of XRP had not changed between 2013 and 2017. It remained a digital asset that is fully interchangeable and fungible, meaning subsequent sales did not constitute a new or distinct securities offering.
The judges noted, “The nature of XRP did not change,” highlighting that existing securities law does not support characterizing later sales as new investment contracts. It is crucial to clarify that this lawsuit was separate from the SEC enforcement actions against Ripple, meaning that the ruling does not directly influence the ongoing SEC case. Nonetheless, legal experts suggest this decision bolsters Ripple”s position, particularly concerning secondary market XRP transactions and arguments related to statutes of limitations.
This ruling, while labeled “not for publication” and lacking binding precedent, definitively concludes this particular case and alleviates another legal concern for Ripple Labs and XRP. It also reinforces Ripple”s longstanding argument that secondary market activities involving XRP do not automatically represent securities offerings.
Despite the favorable ruling for Ripple, the market response to XRP has been tepid. Currently, XRP is trading around $1.90, reflecting a slight decline of 0.11% over the last 24 hours. Market participants have expressed surprise at the lack of significant price movement, as one trader remarked that had this news pertained to any other altcoin, it would likely have experienced a marked surge. Instead, XRP”s reaction seems to convey a sentiment of indifference, with the market responding as if, “it”s okay, it”s nothing.”
