How 75,000 XRP Holders Backed Ripple Through SEC Litigation

The legal battle reached a turning point when Ripple faced internal advice to fold. Co-founder David Schwartz revealed that outside counsel once viewed the company as unsavable, noting that the SEC’s decision to name CEO Brad Garlinghouse and Executive Chairman Chris Larsen personally was intended to pressure them into individual settlements. Instead, the firm spent roughly $150 million on a defense that challenged the regulator's reach.

Deaton played a pivotal role by organizing a group of 75,000 XRP holders, securing their status as amici curiae. This coalition provided research and declarations that countered the SEC’s broad claims, specifically arguing that secondary-market transactions should not be treated as institutional securities sales. According to Ripple deputy general counsel Deborah McCrimmon, these community-sourced records saved the company millions in legal expenses.

The case concluded with a mixed outcome. While Judge Analisa Torres ruled in 2023 that programmatic XRP sales on public exchanges did not constitute securities transactions, the court found institutional sales in violation of federal law. Following a $125 million penalty and the dismissal of appeals in 2025, the final judgment remains in force. Deaton maintains that the collective effort of the XRP community was instrumental in preventing a total capitulation during the most aggressive phases of the agency's pursuit.