Ripple gears for showdown with SEC, final ruling in lawsuit likely this week
- Ripple lawsuit could end by July 31, per the prediction of pro-crypto attorney Fred Rispoli.
- XRP traders keep eyes peeled for settlement with the SEC or news of final ruling in the lawsuit.
- XRP trades above $0.60, altcoin could collect liquidity prior to nearly 11% gains.
Ripple (XRP) lawsuit brought by the Securities & Exchange Commission could end in July 2024. XRP traders are watching the lawsuit closely for updates on settlement or a final ruling by Judge Analisa Torres.
Ripple’s partial victory in July 2023 cemented XRP’s status as a non-security. It remains to be seen whether the US financial regulator appeals the ruling.
XRP trades above key psychological support at $0.60, early on Monday.
Daily digest market movers: Ripple final showdown with SEC likely this week
- The SEC vs. Ripple lawsuit is a key market mover for XRP. Per pro-crypto attorney Fred Rispoli, Ripple lawsuit could end by July 2024, this week.
- XRP holders expect either a settlement in the SEC lawsuit or a fine, the $10 million proposed by Ripple against over $2 billion asked by the regulator.
- There is legal clarity on XRP’s status as a non-security in secondary market transactions, on exchange platforms. It remains to be seen whether this ruling from July 2023 is appealed by the SEC.
- The news of the closed-doors meeting between the two parties acted as a key market mover for the altcoin.
- Ripple update: What to expect from XRP and Ripple lawsuit this week
- As traders keep their eyes peeled for updates, XRP trades above its psychological support level.
- XRP officially got listed on the Chicago Mercantile Exchange (CME) CF reference rates and real-time indices.
BREAKING: $XRP is OFFICIALLY LISTED on CME pic.twitter.com/7WABMMEJg2
— EDO FARINA XRP (@edward_farina) July 29, 2024
Technical analysis: XRP could sweep liquidity under $0.60 and rally nearly 11%
XRP broke out of its downward trend on July 12, forming higher highs and higher lows consistently. XRP is currently above key psychological support at $0.60, and is likely to sweep liquidity in the Fair Value Gap between $0.5404 and $0.5783, the support zone.
Ripple could extend gains by nearly 11% once the imbalance is cleared and target $0.6666, the 78.6% Fibonacci retracement of the decline from its March 11 top of $0.7440 to the July 5 low of $0.3823.
XRP faces resistance at $0.6058, the 61.8% Fibonacci retracement in the XRP/USDT daily chart.
XRP/USDT daily chart
The momentum indicator, Moving Average Convergence Divergence (MACD) supports the thesis of a liquidity sweep as the MACD line crosses under the signal line on July 29. This means there is underlying bearish momentum in XRP price trend.
A daily candlestick close under the $0.5632, or the 50% Fibonacci retracement level could invalidate the recovery rally thesis and signal an impending correction. Ripple could find support at $0.5205, the 38.2% Fibonacci retracement level.
SEC vs Ripple lawsuit FAQs
It depends on the transaction, according to a court ruling released on July 14: For institutional investors or over-the-counter sales, XRP is a security. For retail investors who bought the token via programmatic sales on exchanges, on-demand liquidity services and other platforms, XRP is not a security.
The United States Securities & Exchange Commission (SEC) accused Ripple and its executives of raising more than $1.3 billion through an unregistered asset offering of the XRP token. While the judge ruled that programmatic sales aren’t considered securities, sales of XRP tokens to institutional investors are indeed investment contracts. In this last case, Ripple did breach the US securities law and will need to keep litigating over the around $729 million it received under written contracts.
The ruling offers a partial win for both Ripple and the SEC, depending on what one looks at. Ripple gets a big win over the fact that programmatic sales aren’t considered securities, and this could bode well for the broader crypto sector as most of the assets eyed by the SEC’s crackdown are handled by decentralized entities that sold their tokens mostly to retail investors via exchange platforms, experts say. Still, the ruling doesn’t help much to answer the key question of what makes a digital asset a security, so it isn’t clear yet if this lawsuit will set precedent for other open cases that affect dozens of digital assets. Topics such as which is the right degree of decentralization to avoid the “security” label or where to draw the line between institutional and programmatic sales are likely to persist.
The SEC has stepped up its enforcement actions toward the blockchain and digital assets industry, filing charges against platforms such as Coinbase or Binance for allegedly violating the US Securities law. The SEC claims that the majority of crypto assets are securities and thus subject to strict regulation. While defendants can use parts of Ripple’s ruling in their favor, the SEC can also find reasons in it to keep its current strategy of regulation by enforcement.
The court decision is a partial summary judgment. The ruling can be appealed once a final judgment is issued or if the judge allows it before then. The case is in a pretrial phase, in which both Ripple and the SEC still have the chance to settle.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
