Ripple IPO Likely by 2025 or 2026 as Deaton Predicts SEC Appeal Withdrawal

• Ripple may launch its IPO in late 2025 or early 2026.
• Legal expert John Deaton expects the SEC to withdraw its appeal.
• The Ripple decision remains fact-specific, limiting its broader impact.

Legal analyst John Deaton predicts that Ripple could go public by late 2025 or early 2026, depending on developments in its ongoing SEC legal battle. Deaton suggests the SEC may choose to withdraw its appeal to avoid significant legal and reputational risks.

Ripple IPO on the Horizon

Deaton, known for his active involvement in Ripple’s legal disputes with the SEC, believes the appeal may be dropped under the new SEC chairman’s leadership. This move could pave the way for Ripple’s much-anticipated IPO.

Ripple delayed its IPO plans due to its legal battle with the SEC. In July 2023, U.S. District Judge Analisa Torres ruled that XRP’s secondary market sales did not classify as securities under federal law. Although this decision was seen as a major win, it was limited to the specific facts of Ripple’s case rather than establishing a broader legal precedent.

Why Ripple’s IPO Could Happen Sooner Under New SEC Leadership

Ripple CEO Brad Garlinghouse had earlier said that going public wasn’t a priority under the SEC’s prior administration. However, with Paul Atkins expected to take over as chairman, Ripple’s IPO timeline could accelerate. 

Deaton predicts the SEC, under Atkins, might drop its appeal to avoid further legal setbacks.

Judge Torres’ Decision and Its Impact on XRP’s Future

Deaton outlines several reasons why the SEC’s appeal of the Ripple decision might not proceed. He noted the SEC’s appeal faces substantial hurdles. Deaton highlighted that Judge Torres’s decision is a federal district court ruling and is not a binding precedent. 

Moreover, the ruling has very limited persuasive value, having already been criticized by several legal scholars, Marc Fagel and John Reed Stark, as well as experienced financial journalists such as Charles Gasparino.

Judge Torres’ decision is fact-specific and limited to the particulars of the Ripple case. She ruled that the SEC failed to meet the third element of the Howey Test, specifically that XRP buyers did not rely on Ripple’s efforts to increase the token’s value. 

Torres also made clear that her decision does not suggest that all secondary market sales of digital assets can never constitute securities sales. There are scenarios, such as mass marketing campaigns, that could satisfy the Howey test.

Deaton argues that even if the SEC were to win at the Second Circuit, the case would likely be remanded to Judge Torres, who would likely rule the SEC failed to prove a “common enterprise” related to XRP’s secondary market sales. This could lead to the same outcome that is already available today.