Ripple finds supporters in legal battle agains the SEC allowing XRP price to regain lost ground


  • The SEC has sued Ripple for illegally selling XRP which they consider a security.
  • Several analytic platforms have recently stated that XRP is an utility token and should not be deemed as a security.

The U.S. Securities and Exchange Commission charged Ripple and two executives of conducting a $1.3 billion unregistered securities offering on December 22, 2020. The announcement had a major impact on XRP price which plummeted in the next 48 hours by 60%.

The announcement also forced several major US exchanges to close XRP trading or delist the digital asset. Coinbase, Binance.US, and many others have already stated they will halt XRP trading which has further negatively affected the digital asset.

XRP might not be deemed as a security after all

According to the most recent report released by Gatehub, a popular cryptocurrency wallet, XRP will continue to be supported on the platform unless the SEC’s complaint is adjudicated and the final decision states XRP is a security.

We have never believed that XRP is a “security” under the prevailing “Howey” test in the US, and regard XRP primarily as a “utility” token whose value is based on its use in payments and foreign exchange.

Additionally, the 2021 UK Treasury report defines cryptoassets as a ‘representation of value or contractual rights that can be transferred, stored or traded’. It also divides them into three main categories which include e-money tokens, security tokens and unregulated tokens. XRP is located inside the last category within the ‘exchange tokens’ list. 

Exchange tokens: tokens that are primarily used as a means of exchange – this includes widely known cryptoassets such as Bitcoin,

Ether and XRP.

It seems that both announcements are in favor of XRP and do not regard the digital asset as a security but rather an utility token, exchange token or commodity. 

XRP price might be poised for a rally as whales continue to accumulate

One of the most surprising bullish metrics in favor of XRP is the number of whales holding between 1,000,000 and 10,000,000 coins increasing from 1,112 on December 30, 2020 to 1,152 currently. Despite all the bad news and announcements, it seems that large holders are still interested in buying XRP and expect the price to rise higher.

xrp price

XRP Holders Distribution chart

XRP price seems to be facing two critical resistance levels on the 12-hour chart. First the 50-SMA which has been lost since December 12, 2020. This resistance point is currently located at $0.303.

xrp price

XRP/USD 12-hour chart

Recovering the 50-SMA as a support level can quickly push XRP price towards the next resistance level at $0.38. A breakout above this point would drive the digital asset to a new 2021-high around $0.60.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: XRP in a league of its own as BTC and ETH  pull back

Bitcoin price is currently showing signs of retracement after a second attempt to rally higher. Ethereum price tried following in BTC’s footsteps but lacked momentum. On the other hand, Ripple price is paving its way, but it might fall in line soon.

More Cryptocurrencies News

Shiba Inu exposes risk of 20% collapse

Shiba Inu price action has been uneventful despite the recent crypto market rally led by Bitcoin. SHIB continues to consolidate as it moves sideways, and an indecisive technical pattern has emerged.

More Shiba Inu News

Polygon looks to double in market value

MATIC price is hovering above a crucial support level at $0.996, expecting a break above. A 13% retracement to $0.855 seems likely if the selling pressure increases. A 100% upswing to $1.727 is on the cards for Polygon.

More Polygon News

Flippening becomes more likely as ETH trade volume growth exceeds BTC in first half of 2021

The growth in the trade volume of Ethereum exceeded that of Bitcoin so far in 2021, according to a report from Coinbase Global Inc. Increasing popularity of decentralized finance and the rise of scaling solutions are among key factors contributing to Ethereum's performance.

More Ethereum News

BEST CRYPTO BROKERS/EXCHANGES



Bitcoin Weekly Forecast: Markets revert to mean, but BTC price remains indecisive

Bitcoin price shows considerable strength after springing from the recent crashes. Still, it is uncertain whether the current bullish impulse will morph into a new uptrend or lead to a more profound decline.

Read the weekly forecast

BTC

ETH

XRP