Novogratz Reflects on Misjudging XRP’s Survival Prospects
Galaxy Digital CEO Mike Novogratz has publicly admitted that he underestimated Ripple’s native token, XRP, during its lengthy legal battle with the U.S. Securities and Exchange Commission (SEC). Speaking on Kyle Chasse’s podcast, Novogratz shared candid reflections about his past skepticism toward the asset.
When the SEC filed its $1.3 billion lawsuit against Ripple in December 2021, Novogratz believed the project wouldn’t endure the regulatory pressure. Years later, following the lawsuit’s resolution in August 2025, he now acknowledges that XRP has proven far more resilient than he anticipated.
SEC Lawsuit Shaped Market Perceptions of XRP
The SEC lawsuit accused Ripple of selling unregistered securities, creating widespread uncertainty about XRP’s legal status and future viability. This prolonged legal standoff cast a shadow over Ripple’s operations and investor sentiment for nearly four years.
Many market observers, including Novogratz, viewed the lawsuit as a potential death sentence for XRP. However, Ripple’s determination to fight the charges and eventually reach a settlement significantly shifted the narrative surrounding the token.
Settlement Marks a Major Turning Point for Ripple
In August 2025, the court approved the settlement between Ripple and the SEC, ending one of the most closely watched legal battles in crypto history. This resolution provided much-needed regulatory clarity for XRP and boosted market confidence in its long-term prospects.
The settlement’s impact was immediate: investor optimism surged, liquidity improved, and XRP rallied strongly in the months that followed. The outcome also underscored Ripple’s strategic resilience and legal perseverance.
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Ripple’s Leadership Credited for Legal Victory
Novogratz highlighted Ripple CEO Brad Garlinghouse’s role in steering the company through turbulent times. He praised Garlinghouse’s leadership in managing both the legal strategy and community engagement throughout the lawsuit.
Garlinghouse’s ability to maintain morale and keep the community united was instrumental in preserving Ripple’s operational strength. Novogratz described the XRP community as “one of the strongest” in the entire crypto industry.
XRP Community Loyalty Surprised Industry Veterans
Initially, Novogratz viewed the XRP community with skepticism, likening its intense loyalty to a “cult.” However, he later admitted that this level of commitment is common among fans of many successful cryptocurrencies, including Bitcoin.
He cited the example of one of his own employees who treats Bitcoin as “the meaning of life,” noting that passionate communities often underpin the longevity of major crypto assets. XRP’s dedicated base played a key role in sustaining momentum during uncertain times.
XRP’s Post-Settlement Rally Validated Long-Term Holders
Following the legal resolution, XRP emerged as one of the best-performing assets after November 2024. In July 2025, the token reached a new all-time high of $3.65, marking a 337% surge over the previous year.
Novogratz acknowledged this rally with irony, remarking, “Who would have thought?” His statement reflects a broader shift in sentiment as XRP’s market performance defied bearish expectations.
Industry Debate Continues Despite Legal Clarity
While XRP has gained new momentum, critics remain. On-chain investigator ZachXBT previously compared operational models of Ripple, Cardano, and Hedera to financial pyramids, fueling ongoing debates about decentralization and sustainability.
Despite differing opinions, XRP’s legal clarity, strong community, and renewed price trajectory position it as a formidable player in the evolving digital asset landscape.
Novogratz’s Admission Reflects XRP’s Remarkable Resilience
Mike Novogratz’s candid acknowledgment underscores how XRP has defied expectations through regulatory clarity, strong leadership, and community loyalty. Once doubted, Ripple’s token has re-established itself as a major asset with significant market traction.
As the crypto sector matures, XRP’s journey highlights how underestimated tokens can rebound through strategic persistence and community strength—turning skeptics into surprised admirers.
