A split-the-difference court decision moves the years-long proceeding between the Securities and Exchange Commission and blockchain developer Ripple Labs one step closer to conclusion.

Why it matters: The Ripple case has been closely watched for its potential to move the debate around crypto token classification — a key issue driving regulation and a recent wave of enforcement actions.

Details: The court on Thursday ruled that institutional sales of Ripple's XRP token — such as hedge funds or venture capital firms buying XRP directly from Ripple — "constituted an unregistered offer and sale of investment contracts," thus in violation of federal securities laws.

Yes, but: Secondary sales, or "programmatic sales," of XRP on crypto exchanges, did not, because a secondary market buyer "did not know to whom or what it was paying its money,” the court ruled.

Quick take: It's a win for Ripple.

What they're saying: "The SEC sued me personally too, so I feel vindicated," Brad Garlinghouse, CEO of Ripple tells Axios.

• He added that Ripple's victory, was more importantly "a win for crypto in the U.S."
• Stu Alderoty, Ripple's legal counsel, added that it was "a really important, fundamental, legal clarification" from the order: "The digital asset itself is not an investment contract."

Zoom out: The XRP token, and whether it is considered a security, was at the heart of the SEC lawsuit against San...

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