XRP price might be looking at a decline even as speculation of Ripple and SEC settling intensify
- Ripple and the SEC are said to be close to a settlement as the regulator is scheduled to hold a closed-door meeting on November 30.
- Both parties have until February 2024 to come up with a remedy for the current situation, fueling the speculation.
- XRP price decline has extended to nearly 20% in two weeks, reducing the chances of a recovery.
XRP price could likely continue its streak of disappointing investors that began two weeks ago and end up increasing the losses witnessed by investors. This is the condition of the market despite the potential of Ripple and SEC settling the latter’s lawsuit this month and picking up the heat.
Ripple and SEC to settle soon
Ripple and the Securities & Exchange Commission (SEC) are expected to conclude the ongoing three-year-long lawsuit that began in December 2020. This would be achieved by both parties settling the case since not only has the SEC partially lost the first ruling from the court, but the next one will be held in 2024.
Until then, Ripple has a chance to dig up enough evidence to complete their win in the court trial. The closed-door meeting, called the Sunshine Act Meetings, will be held on November 30 next week.
While the specifics of the subjects to be discussed are not mentioned in the announcement, the subject matters of the closed meeting will consist of the following topics:
- Institution and settlement of injunctive actions
- Institution and settlement of administrative proceedings
- Resolution of litigation claims
- Matters related to litigation
- Other matters relating to examinations and enforcement proceedings
One of these topics is speculated to regard the SEC and Ripple lawsuit.
If that turns out to be true and the two entities put an end to one of the biggest lawsuits in crypto history, it would suggest that XRP price is on the heels of a rally.
XRP price might see a further decline
XRP price might find some difficulty in charting gains even after the settlement of the lawsuit, in part due to the broader market cues turning bearish. The decline noted by the Ripple token in the last two weeks has seen the altcoin fall by almost 19%, bringing XRP below the $0.60 mark.
Looking at the Moving Average Convergence Divergence (MACD), the chances of a bearish move going forward seem more likely. The indicator maintains a bearish crossover with red bars still standing on the histogram.
Thus, if the altcoin sees further decline, a test of the $0.55 support line is likely to follow a failed breach of the $0.59 resistance level. Losing this support would completely wipe out the 31% gain noted in the past month, sending XRP to $0.54.
XRP/USD 1-day chart
However, a successful breach combined with the rising optimism and potential settlement would result in the recovery of XRP price. To ascertain the rally, the $0.60 resistance needs to be flipped into a support floor. This will allow Ripple to tag the next resistance of $0.69, and breaching it would invalidate the bearish thesis, pushing the XRP price beyond $0.70.
Cryptocurrency metrics FAQs
What is circulating supply?
The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.
What is market capitalization?
Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.
What is trading volume?
Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.
What is funding rate?
Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.
Author
Aaryamann Shrivastava
FXStreet
Aaryamann Shrivastava is a Cryptocurrency journalist and market analyst with over 1,000 articles under his name. Graduated with an Honours in Journalism, he has been part of the crypto industry for more than a year now.
