A crypto-skeptical commissioner at the US Securities and Exchange Commission has blasted her agency over its settlement letter that could finally end the Ripple legal saga.

The SEC and Ripple filed a joint settlement letter in a New York court asking for the August 2024 injunction against Ripple to be dissolved and $75 million of the $125 million in civil penalties held in escrow to be returned to the crypto firm, according to a May 8 statement from the SEC.

SEC Commissioner Caroline Crenshaw blasted the pending deal in a May 8 statement, saying it would damage the regulators’ ability to keep crypto firms in line and undermine the court’s ruling.

“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,” she said.

“In the meantime, the settlement joins a line of dismissals that collectively erode the credibility of our lawyers in court who are being asked to take legal positions today contrary to the ones taken just months ago.”

Under the Trump administration, the SEC has slowly been walking back its hardline stance toward crypto firms forged under former SEC Chair Gary Gensler’s reign, dismissing a growing number of enforcement actions against crypto firms.

At the same time, Crenshaw argues that if Judge Torres accepts the settlement, it would erase “the investor protections we already won” and leave a “regulatory vacuum,” until the crypto task force hammers out a regulatory framework.

“The settlement is not in the best interests of the investors and markets that our agency is tasked with serving and protecting. It creates more questions than answers.”

In August last year, a Judge ordered Ripple to pay $125 million in penalties after ruling the firm’s XRP token was covered by securities laws when sold to institutional investors.

What’s next for the Ripple case? It’s not over yet

While the SEC and Ripple have agreed to a settlement, it’s still not a done deal, according to ex-federal prosecutor James Filan, because there are several steps before the long-running legal saga can conclude.

For a start, Judge Torres needs to provide an indicative ruling if she agrees to the settlement letter, Filan said in a May 8 analysis on X.

If Torres provides an indicative ruling, the SEC and Ripple will ask the Second Circuit Court of Appeals for a limited remand back to Judge Torres, which, if granted, will result in another motion being filed for the agreed settlement, according to Filan.

“After the injunction is dissolved and the funds distributed, the SEC and Ripple will ask the Court of Appeals to dismiss the SEC’s appeal and Ripple’s cross-appeal. Then it will be over,” he said.

The SEC initially launched legal action against Ripple Labs in December 2020, accusing the firm of illegally selling its token as an unregistered security.