The recent legal developments in the ongoing battle between blockchain platforms and the U.S. Securities and Exchange Commission (SEC) have reignited momentum in the cryptocurrency community — particularly for supporters of XRP. A pivotal ruling in the LBRY Credits (LBC) case has sparked renewed calls for major exchanges, especially Coinbase, to reconsider their stance on listing XRP.
A Legal Precedent That Could Reshape Crypto Regulation
In a significant decision, the U.S. District Court for the District of New Hampshire ruled that secondary market sales of LBRY Credits (LBC) do not constitute the sale of securities. This second ruling from Judge Paul Barbadoro reinforces the argument that many digital assets, including XRP, should not be classified as securities under current U.S. law.
The court declined to issue an injunction halting the trading of LBC tokens — a key demand from the SEC under Chairman Gary Gensler’s leadership. This outcome strengthens the position that decentralized token transactions on exchanges, whether centralized or decentralized, fall outside the traditional definition of investment contracts outlined in the Howey Test.
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Why the LBC Ruling Matters for XRP
The implications of this verdict extend far beyond LBRY. The blockchain-based digital content platform has now publicly urged Coinbase — one of the largest and most influential U.S.-based cryptocurrency exchanges — to relist XRP based on the precedent set by the LBC case.
In a widely shared tweet, LBRY stated:
“Coinbase should relist $XRP. Under the SEC vs LBRY standard, XRP sold by secondary holders is not a security.”
This statement carries substantial weight. If tokens traded on secondary markets are not deemed securities, then delisting assets like XRP after initial regulatory scrutiny may no longer be legally justified — especially when those trades involve retail investors and peer-to-peer transactions rather than direct issuance by a company.
The SEC originally filed its lawsuit against Ripple Labs in December 2020, alleging that the firm had conducted an unregistered securities offering through the sale of XRP. As a result, numerous U.S. exchanges, including Coinbase, removed XRP from their platforms.
However, with increasing judicial pushback against broad interpretations of what constitutes a security, market participants are questioning whether such delistings were premature — or even necessary.
Growing Momentum for XRP Relisting
While some platforms have already taken steps toward normalization, progress remains uneven. For instance, Newton, a Canada-based crypto exchange, relisted XRP in November 2022 following early signs of regulatory clarity. However, Coinbase has yet to follow suit, despite mounting pressure from users and growing legal support for XRP’s classification as a non-security.
The Ripple vs. SEC case is expected to reach a conclusion in mid-2025, and recent rulings suggest a favorable outcome for Ripple. In July 2023, Judge Analisa Torres determined that XRP itself is not inherently a security, although certain institutional sales by Ripple could qualify as unregistered securities offerings.
This nuanced distinction aligns closely with the reasoning behind the LBRY decision — namely, that context matters. The nature of the transaction, the expectations of buyers, and the level of centralization all influence whether a digital asset qualifies as a security.
Core Keywords Driving Market Sentiment
Understanding this evolving landscape requires familiarity with several core concepts shaping investor sentiment and regulatory debate:
- XRP relisting
- SEC crypto regulations
- digital asset securities
- LBRY vs SEC ruling
- cryptocurrency legal precedent
- Coinbase listing decisions
- secondary market token sales
- Howey Test application
These keywords reflect both technical legal frameworks and real-world market dynamics. They also highlight search intent among users seeking clarity on whether XRP will return to major U.S. exchanges and what legal foundations support such a move.
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Frequently Asked Questions (FAQ)
Does the LBRY ruling directly apply to XRP?
While not binding in other jurisdictions, the LBRY ruling sets a persuasive legal precedent. Courts often consider similar cases when interpreting laws. The logic used — that secondary market trades don’t meet the Howey Test criteria — can be applied to other tokens like XRP.
Why hasn’t Coinbase relisted XRP yet?
Coinbase operates under strict compliance protocols. While legal developments are encouraging, the exchange likely awaits final resolution of the Ripple vs. SEC case before making any official move. However, pressure from users and evolving case law may accelerate this timeline.
Is XRP considered a security in the U.S.?
As of now, there is no definitive nationwide classification. A federal judge ruled that XRP is not a security when sold to retail investors or on exchanges, but institutional sales by Ripple may still fall under securities laws. This split decision leaves room for interpretation.
What role does the Howey Test play in these rulings?
The Howey Test determines whether a transaction qualifies as an investment contract — a key factor in defining securities. If buyers don’t expect profits derived from others’ efforts (e.g., developers or promoters), the asset typically doesn’t meet the test. Both LBRY and XRP rulings emphasize decentralized, open-market trading where such expectations are absent.
Could more altcoins benefit from this precedent?
Yes. The LBRY and Ripple cases could influence how other tokens are treated legally. Assets with decentralized networks and widespread secondary trading may increasingly be excluded from securities classification, promoting innovation and liquidity.
What should XRP holders do while waiting for relisting?
Holders should stay informed through reliable sources, engage with exchange feedback channels, and consider using compliant international platforms where XRP remains available. Regulatory clarity continues to improve, increasing the likelihood of broader reinstatement.
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The Path Forward for Crypto Exchanges
The LBRY ruling underscores a growing judicial trend: distinguishing between centralized fundraising activities and open-market token trading. This differentiation is critical for fostering innovation while maintaining investor protection.
For exchanges like Coinbase, revisiting delisting decisions in light of new legal standards isn’t just prudent — it may soon become inevitable. As courts continue to refine the boundaries of digital asset regulation, platforms must balance compliance with user demand and technological reality.
Moreover, public statements from projects like LBRY amplify community voices and add legitimacy to calls for fair treatment of digital assets. Their advocacy highlights that regulatory outcomes should be based on facts and legal principles — not fear or overreach.
As we move deeper into 2025, expect increased scrutiny on how regulators and exchanges respond to these landmark decisions. The future of crypto trading in the U.S. hinges not only on technology but on the rule of law — and so far, the tide appears to be turning.
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