Cryptocurrency lawsuits in 2025 reshaped how digital assets are regulated in the United States: the SEC dismissed its headline cases against Coinbase, Binance, and other major exchanges, Ripple settled a four-year fight for a fraction of the original penalty, Congress passed the first federal stablecoin law, and FTX and Terraform Labs began paying creditors from multibillion-dollar recovery pools. At the same time, states, private plaintiffs, and the Department of Justice kept the litigation pipeline full with fraud prosecutions, class actions, and a $225 million pig-butchering seizure.
Here is what happened, case by case, and what it means for anyone tracking crypto in the courts.
The SEC Dropped Its Cases Against the Major Exchanges
The biggest shift came from inside the SEC. Chairman Paul S. Atkins was sworn in on April 21, 2025, and the agency began dismissing enforcement actions the prior commission had brought against crypto firms. Beginning in February 2025, the SEC dropped seven major cases, including those against Coinbase, Binance, Consensys, and Payward (Kraken).1SEC.gov. SEC Announces Results of Fiscal Year 2025 Enforcement Actions
The Coinbase dismissal on February 27, 2025, mattered most. The SEC had sued Coinbase in June 2023 alleging the platform sold unregistered securities. A federal judge denied Coinbase’s motion to dismiss in March 2024, and the company had just won the right to an interlocutory appeal when the new administration took over.2A&O Shearman. SEC Pivots: What It Means for Crypto The parties filed a joint stipulation to dismiss with prejudice and no fines, with the SEC saying the move would “facilitate the Commission’s ongoing efforts to reform and renew its regulatory approach to the crypto industry.”3SEC.gov. Joint Motion to Dismiss SEC v. Coinbase The Binance case followed the same path, dismissed with prejudice on May 29, 2025.4SEC.gov. SEC v. Binance Holdings Limited, Litigation Release
Overall SEC enforcement activity dropped sharply. Total actions in fiscal year 2025 fell to 313, the lowest in a decade and 27% below the prior year. Monetary settlements fell 45% to $808 million.5Harvard Law School Forum on Corporate Governance. SEC Enforcement 2025 Year in Review
Ripple Settled for $50 Million
The four-year Ripple case ended with a settlement filed on May 8, 2025. The August 2024 judgment had imposed a $125 million civil penalty and a permanent injunction after the court found that Ripple’s institutional sales of XRP violated securities registration requirements. Under the settlement, Ripple paid $50 million in full satisfaction of the penalty, the remaining $75 million was returned from escrow, and the injunction was vacated. Both sides agreed not to seek to vacate or amend the district court’s summary judgment ruling and dismissed their pending Second Circuit appeals.6SEC.gov. SEC v. Ripple Labs, Litigation Release No. 26306
Commissioner Caroline A. Crenshaw dissented, saying the settlement “razes the civil penalty ruling as well as the court-imposed injunction.”7SEC.gov. Commissioner Crenshaw Statement on Ripple Settlement Ripple CEO Brad Garlinghouse called the outcome a victory and said the SEC’s suit had wiped out $15 billion in value from XRP holders.8Ripple. Ripple CEO Brad Garlinghouse on XRP Victory
The Fraud Cases the SEC Kept
The SEC did not stop bringing cases; it stopped bringing cases that turned on whether a token itself is a security. Traditional fraud prosecutions continued.
On May 20, 2025, the SEC charged Unicoin, Inc. and four executives with orchestrating a $100 million securities offering fraud. The Southern District of New York complaint alleges the defendants misled over 5,000 investors by claiming Unicoin tokens were “asset-backed” by billions in real estate and pre-IPO equity when the assets were worth a fraction of that amount, and by marketing the tokens as “SEC-registered.”9SEC.gov. SEC Charges Unicoin and Executives With Securities Offering Fraud Named defendants are CEO Alex Konanykhin, former president Silvina Moschini, former chief investment officer Alex Dominguez, and general counsel Richard Devlin. Devlin settled without admitting or denying the allegations and paid a $37,500 civil penalty.10SEC.gov. SEC v. Unicoin Inc., Litigation Release No. 26314 The remaining defendants moved to dismiss in August 2025; the case is pending with discovery set to conclude by November 2026.11CourtListener. SEC v. Unicoin Inc., Docket
Other 2025 fraud actions included a case against Ramil Palafox, founder of PGI Global, over a $198 million crypto and foreign-exchange scheme, and a case against the founder of Nate, Inc. for soliciting $42 million on false claims about the company’s use of artificial intelligence.1SEC.gov. SEC Announces Results of Fiscal Year 2025 Enforcement Actions
A market-manipulation case from an FBI undercover sting also closed out. CLS Global FZC LLC, a UAE-based crypto services firm, pleaded guilty in the District of Massachusetts in January 2025 to conspiracy to commit market manipulation and wire fraud. The firm had used an algorithm and a network of wallets to wash-trade “NexFundAI,” a sham cryptocurrency created by law enforcement, to fabricate the appearance of genuine volume on Uniswap. CLS was sentenced on April 2, 2025, to three years of probation and $428,059 in fines and forfeited cryptocurrency, and is barred from serving U.S. clients during probation.12DOJ. Cryptocurrency Financial Services Firm Sentenced for Cryptocurrency Wash Trading On March 31, 2026, the SEC voluntarily dismissed five related civil wash-trading cases.13Morrison Foerster. Top 5 SEC Enforcement Developments for March 2026
The Tron case closed on March 5, 2026. Originally filed against Rainberry, Inc. (formerly BitTorrent), Justin Sun, Tron Foundation Limited, and BitTorrent Foundation Ltd. on scienter-based fraud theories, the final settlement was limited to negligence-based violations under Section 17(a)(3) of the Securities Act. Rainberry paid a $10 million civil penalty without admitting or denying the allegations, and the SEC dropped the disgorgement it had originally sought.13Morrison Foerster. Top 5 SEC Enforcement Developments for March 2026
DOJ Pulled Back but Kept Seizing Fraud Proceeds
The Justice Department followed the SEC’s lead on classification questions. On April 7, 2025, Deputy Attorney General Todd Blanche issued a memorandum titled “Ending Regulation by Prosecution,” directing prosecutors to stop pursuing litigation that “superimposes regulatory frameworks on digital assets.” The DOJ disbanded its National Cryptocurrency Enforcement Team and told prosecutors to avoid charging Securities Act or Commodity Exchange Act violations that would require litigating whether a digital asset is a security or commodity.14Global Investigations Review. DOJ and SEC Crypto Exchange Enforcement in the United States
That did not stop asset seizures in fraud cases. On June 18, 2025, the DOJ filed a civil forfeiture complaint in the District of Columbia targeting over $225.3 million in cryptocurrency linked to “pig butchering” scams that lure victims into fake crypto platforms. The U.S. Secret Service called it the largest cryptocurrency seizure in its history.15DOJ. United States Files Civil Forfeiture Complaint Against $225M in Funds Involved in Cryptocurrency Fraud The FBI and Secret Service traced hundreds of thousands of blockchain transactions tied to at least 400 suspected victims worldwide, with assistance from the stablecoin issuer Tether.16CNBC. DOJ Seizes $225 Million in Crypto Scam Proceeds
New Rules of the Road
The retreat from enforcement did not leave a vacuum. Formal guidance and legislation began filling the space.
On March 17, 2026, the SEC and CFTC released joint interpretive guidance sorting crypto assets into five categories: digital commodities, digital collectibles, digital tools, stablecoins, and digital securities. Bitcoin, Ether, Solana, XRP, and Cardano were identified as digital commodities whose value derives from programmatic operation and supply-and-demand rather than the essential managerial efforts of others, placing them outside the definition of a security.17SEC.gov. Joint Interpretive Guidance on Classification of Crypto Assets The guidance also stated that proof-of-work mining, proof-of-stake staking, and airdrops requiring no consideration are generally not securities transactions. The release supersedes the SEC’s 2019 staff framework and binds the commission’s administration of the securities laws, though it is not formal rulemaking and does not bind courts.18Ropes & Gray. SEC and CFTC Issue Landmark Joint Guidance on Classification of Crypto Assets
Congress moved too. The GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins Act) was signed into law on July 18, 2025, creating a federal framework for payment stablecoins. It requires issuers to hold one-to-one reserves in cash or U.S. Treasuries and expressly excludes payment stablecoins from the definitions of “security” and “commodity.” The law takes effect roughly 18 months after enactment, around January 2027.19Chapman and Cutler. Mid-Summer Developments in Crypto Legislation and Regulatory Guidance The companion CLARITY Act (Digital Asset Market Clarity Act of 2025), which draws jurisdictional lines between the SEC and CFTC for spot crypto markets, passed the House in July 2025 and cleared the Senate Banking Committee on May 14, 2026, on a 15–9 vote.20U.S. Senate Committee on Banking, Housing, and Urban Affairs. Chairman Scott: Senate Banking Committee Advance CLARITY Act in Historic Bipartisan Vote
Bankruptcy Payouts: FTX and Terraform
Two of the largest crypto bankruptcies moved into distribution in 2025.
FTX Trading’s Chapter 11 plan, approved in October 2024, became effective on January 3, 2025, with a recovery pool over $14 billion. The plan lets non-governmental creditors receive “substantially more than 100 percent” of their allowed claims, though claims were valued at November 2022 prices when Bitcoin was around $16,000. Key settlements underlying the plan include $200 million in cash to resolve $24 billion in IRS claims, $875 million with BlockFi, and an agreement with the DOJ on $1.2 billion in forfeiture proceeds.21Sullivan & Cromwell. FTX Emerges From Bankruptcy Under $14 Billion Plan The FTX Recovery Trust has also pressed clawback litigation, including a suit against Mirana Corp, Bybit Fintech Ltd., and affiliated entities seeking to recover $838 million in pre-bankruptcy transfers; the estate alleges FTX employees prioritized over $327 million in withdrawals for Mirana during the collapse. The case is pending in the U.S. Bankruptcy Court for the District of Delaware.22Yahoo Finance. FTX Bankruptcy Estate Files Lawsuit Against Bybit
The SEC’s $4.47 billion judgment against Terraform Labs and co-founder Do Hyeong Kwon is being administered through Terraform’s Chapter 11 in the District of Delaware. A liquidating plan approved in September 2024 established a trust to distribute assets to creditors and harmed investors, and Kwon was ordered to transfer $204.3 million to the estate, including $7 million in cash and all remaining Luna Foundation Guard crypto assets. The claims bar date was May 16, 2025, and the SEC will not receive any funds until investors and creditors are paid in full.23SEC.gov. SEC v. Terraform Labs – Distribution Information If you were a Terraform investor and did not file by that date, the window has closed.
States and Private Plaintiffs Stepped Into the Gap
The federal retreat did not end crypto litigation; it shifted it to states and private plaintiffs.
Oregon Attorney General Dan Rayfield sued Coinbase in state court on April 18, 2025, alleging the exchange ran an “illegal securities business” in Oregon by selling 31 unregistered crypto tokens, including SOL, XRP, NEAR, MATIC, and ADA. The complaint noted specifically that the SEC’s dismissal of its own case was “not based on any assessment of the merits of the claims.”24Oregon DOJ. State of Oregon v. Coinbase Complaint Coinbase removed the case to federal court in June 2025 and moved to dismiss in August 2025; Oregon moved to remand. In September 2025 a magistrate judge recommended granting the remand and letting the Blockchain Association appear as amicus. The case is still active as of mid-2026, with the motion to dismiss stayed pending the jurisdictional fight.25CourtListener. State of Oregon v. Coinbase Inc., Docket
Before the SEC’s reversal, 18 state attorneys general had already sued the agency over its crypto policies. Led by Kentucky AG Russell Coleman, the coalition filed suit on November 14, 2024, in the Eastern District of Kentucky, arguing the SEC was “brashly overstepping its authority” by trying to classify cryptocurrencies as investment contracts without Congressional authorization and interfering with state enforcement of laws such as Kentucky’s authority over abandoned virtual currency. Joining states include Arkansas, Florida, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Montana, Nebraska, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Utah, and West Virginia.26Kentucky.gov. AG Coleman Leads 18-State Coalition Lawsuit Against SEC The SEC’s later policy reversal has substantially changed the ground the suit was filed on, and no ruling has been reported.
Private plaintiffs also stayed busy. A class action in the Southern District of New York accuses promoter Hayden Davis and Ben Chow, former CEO of the Meteora exchange, of executing a “rug pull” on the $LIBRA meme coin, which launched on Solana in February 2025, briefly reached a $4.56 billion market cap, and lost 97% of its value. Plaintiffs allege over $280 million was drained from a liquidity pool.27Cahill Gordon & Reindel. Cahill Defeats Plaintiffs’ Bid to Freeze Assets in High-Profile Libra-Gate Class Action Judge Jennifer L. Rochon froze $57.6 million in USDC stablecoins linked to the defendants in May 2025 but ordered the funds released in August, finding plaintiffs failed to show irreparable harm and that defendants showed no intent to move or hide assets. She described the case as still in an early stage and expressed skepticism about the plaintiffs’ likelihood of success.28Crypto News. US Court Clears $57M in Frozen USDC in Libra Token Lawsuit
An outlier worth flagging: an anonymous plaintiff calling himself “Noah Doe” sued in New York County Supreme Court to be declared the legal owner of 39,069 dormant Bitcoin addresses holding roughly 3.8 million BTC, worth about $293 billion. The targeted addresses include roughly 21,923 wallets tied to the “Patoshi” mining pattern attributed to Satoshi Nakamoto, coins from the 2011 Mt. Gox hack, and provably unspendable burn addresses. The theory relies on New York’s lost property statute, with an expert valuation claiming each address is worth less than $10 to unlock a one-year title-vesting path. The plaintiff attempted service by delivering USB drives to an NYPD precinct and sending 546-satoshi payments to each defendant address.29Bitcoin Magazine. Anonymous Plaintiff Seeks Legal Bitcoin Judge Kathy J. King stayed all proceedings on June 5, 2026, preventing a default judgment when no defendants appeared. Ripple CTO David Schwartz said even a favorable court ruling would carry “little practical weight” since only a valid cryptographic signature can move Bitcoin, and the plaintiff holds no private keys.30Yahoo Finance. Ripple Ex-CTO Mocks Lawsuit
Class Actions and How Courts Are Treating Tokens
Crypto-related securities class action filings climbed in 2025. One industry report counted 14 filings, a 75% increase over 2024;31NERA. Recent Trends in Securities Class Action Litigation: 2025 Full-Year Review another counted nine. Cryptocurrency ranked among the top three categories for new securities litigation, behind artificial intelligence and SPACs.32Cornerstone Research. Securities Class Action Filings: 2025 Year in Review
Courts kept working through when a crypto asset is a security. A federal judge ruled that fiat-backed stablecoins are generally not securities, except during a de-pegging event, while another court found that NFTs with promised future benefits were plausibly alleged to be securities. The Second Circuit continued limiting primary liability for open-source protocol developers where trading happens without custodial control, and the Southern District of New York distinguished between centralized exchanges that intermediate transactions (potentially liable as statutory sellers) and decentralized protocols that only develop code.33Norton Rose Fulbright. Digital Asset Disputes: 2025 in Review and What to Expect in 2026
Settlements worth noting include a $13.3 million preliminary settlement in the BlockFi securities class action over crypto deposit accounts and a $2.9 million final settlement in the NFT case Harper v. O’Neal. Courts granted class certification in the EthereumMax and De Ford v. Koutoulas litigation for claims based on the sale of unregistered securities, while denying certification for consumer protection and unjust enrichment theories. That pattern, in which unregistered-sale claims that do not require proof of fraud are the preferred vehicle, is now the template for crypto class actions.34Duane Morris. Key Crypto Class Action Trends and Rulings 2025