The Securities and Exchange Commission is rapidly backpedaling on its crypto crackdown, leaving its appeal against Ripple hanging by a thread. Former SEC official John Reed Stark is now predicting the agency will abandon its appeal altogether, citing a series of recent moves that signal a dramatic shift in the SEC’s approach to digital assets.

The signs are pretty obvious. The SEC has dropped appeals on crypto firms as securities dealers, paused multiple crypto cases, and completely restructured its Crypto and Cyber Unit. Key litigators who once led the charge against the industry? Reassigned. Talk about reading the room.

This retreat comes after a significant defeat in the Ripple case, where Judge Torres ruled that programmatic sales of XRP weren’t securities offerings—a massive blow to the SEC’s entire crypto enforcement strategy. They did manage to extract a $125 million fine for institutional sales, but that’s hardly the victory they were looking for after a four-year legal battle.

Legal experts aren’t mincing words about the appeal’s chances. Attorney James Murphy believes it’s unlikely to succeed, and multiple pro-XRP lawyers point out that the SEC’s arguments have already failed once. Fred Rispoli didn’t hold back, calling the SEC’s justifications “cowardly.”

The timing isn’t coincidental. A new administration with pro-crypto leanings is taking shape, and the SEC is suddenly finding its regulatory zeal curiously diminished. Acting Chair Mark Uyeda is conducting an internal review that could further reshape the agency’s approach.

For XRP holders, the potential abandonment of the appeal could trigger a significant price increase. The broader implications for crypto regulation in America are even more substantial—this could set precedents for other digital assets and signal a genuine pivot toward regulatory clarity.

The options are dwindling: drop the appeal, settle, or continue a fight they’re increasingly likely to lose. Whatever happens, one thing’s clear—the SEC’s crypto crusade is losing steam. Fast.