- Ripple ruling, which labels XRP as a non-security in secondary sales, is at risk of being thrown out.
- XRP may be declared as an unregistered security after two federal judges scoff at Ripple ruling from July 2023.
- XRP price resists decline below the psychologically important $0.60 level.
Ripple (XRP) ruling from July 2023 differentiates between XRP secondary market sales and institutional sales of the token by Ripple. Per the July ruling by Judge Analisa Torres, the altcoin is identified as a “non-security” in transactions on exchanges.
The ruling is in jeopardy as two federal judges have thrown out Judge Torres's application of the Howey Test to XRP, and American Journalist Charles Gasparino highlights the incoherence.
Daily digest market movers: Ripple ruling at risk of being thrown out
- Ripple Labs’ token XRP was classified as a “non-security” in secondary market sales and a “security” in institutional sales made by the payment remittance firm.
- The classification by Judge Analisa Torres, in the July 13, 2023 ruling, relied on the US Supreme Court’s Howey test, a legal framework that helps identify whether an asset is an investment contract and therefore a security under securities laws.
- Judge Torres applied Howey and divided XRP sales in two categories, however this application is being questioned by US Federal judges in the Coinbase and Terraform Labs’ lawsuits.
- Charles Gasparino, an American journalist and XRP expert states that rejection of Judge Torres’ ruling by judges shows the “incoherence” of her Howey application.
- Gasparino remarks that no one can guarantee the ruling, it may get thrown out and XRP may be declared as an unregistered security, he considers the reaction from the federal judges as a sign that Judge Torres’ legal analysis is “faulty.”
A reminder to the $XRP community: So far TWO Fed judges including the one considered the "dean" of corporate-law judiciary (Rakoff) have scoffed at arguments using Judge Torres' @Ripple ruling as precedent because the ruling itself is so incoherent. No one can guarantee the… https://t.co/aOwfZ8ERfF
— Charles Gasparino (@CGasparino) March 31, 2024
- Ripple’s Chief Legal Officer Stuart Alderoty re-read the Coinbase ruling from Wednesday and said that the Securities and Exchange Commission (SEC) has sold the Judge a bill of good to accept in the Coinbase lawsuit.
- The difficult part, where the SEC produces evidence, comes next, and Alderoty expects the regulator to face the heat at this stage.
Remember that time the Ripple judge booted the SEC’s hack expert who tried to say he knew what purchasers of XRP were relying on.
— Stuart Alderoty (@s_alderoty) March 30, 2024
- XRP price decline comes alongside whale accumulation of the altcoin. On-chain metrics point at whales “buying the dip.”
- Data from Santiment shows that XRP whales holding between 10 million and 100 million tokens added 190 million XRP tokens to their holdings between March 27 and April 1. This cohort is important because it typically accumulates during the dip and takes profits at local tops, as seen in the Santiment chart for a six-month timeframe.
- A larger whale cohort, holding over 100 million XRP tokens was also seen accumulating, in the chart below.
 [10.20.28, 01 Apr, 2024]-638475478684075958.png)
XRP supply distribution
Technical analysis: XRP price rangebound above key psychological level
Ripple price has been consolidating between a tight range, $0.9380 (July 13, 2023 peak) and $0.4226 (August 14, 2023 low) for over 460 days. The development has resulted in a flip of the $0.67 support level into resistance for the altcoin.
Currently, XRP price is trading above the psychologically important $0.60 level, the weekly Relative Strength Index (RSI) is above 42 for over a year, hinting that buyers remain in control of Ripple. The Awesome Oscillator (AO) is hovering above the zero level, its green bars consecutively taller, suggesting that there is a dominant bullish momentum in the altcoin.
XRP price is likely primed for a recovery to the year-to-date peak of $0.7440 (March 11, 2024). This is roughly 16% away from the current price of $0.6233.
XRP/USDT 1-week price chart
There is a likelihood of a recovery in XRP price however traders need to watch Bitcoin price for cues. A Bitcoin price correction could jeopardize altcoin gains and take XRP and other large market cap tokens down with it.
In the downside scenario, XRP price could tumble to the January 28 low of $0.4853 (a crash of nearly 20%) or the weekly support level at $0.4117.
Crypto ETF FAQs
An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.
Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale – whose application for a Bitcoin spot ETF was initially rejected by the SEC – got a victory in court, forcing the US regulator to review its proposal again. The SEC’s loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.
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.
Recommended Content
Editors’ Picks
New York Attorney General reaches $2 billion settlement with Genesis after claims of fraud
New York Attorney General Letitia James says her office has secured a $2 billion settlement from Genesis. AG Letitia James sued the crypto company in October on account of lying and defrauding investors of over $1 billion.
Digital asset weekly inflows jump over 600% following response to CPI report
Coinshares weekly report of digital asset flows shows that crypto assets witnessed more than a 600% increase in net inflows last week after US Consumer Price Index saw a softer-than-expected inflation increase.
Ethereum sees a 16% spike as Bloomberg analysts surprisingly increase approval odds to 75%
Ethereum's (ETH) price gained over 16% on Monday as Bloomberg analysts updated their odds for spot Ethereum ETF approval to 75%. Grayscale’s CEO stepping down from his role days before the Securities & Exchange Commission (SEC) decides on the ETFs has also added complexity to the predictions of analysts.
Tokens with high FDVs, low circulating supply face fierce criticism from crypto community
Tokens with high fully-diluted valuations (FDV) have been subject to fierce criticism recently following a series of token unlocks that has caused losses for several investors. As a result, Binance has said in an announcement on Monday that it will give more focus to small and medium-valued crypto projects.
Bitcoin: Is BTC out of the woods? Premium
Bitcoin (BTC) price action in the past two days has confirmed the resumption of the bull run. However, BTC needs to clear a few key hurdles before investors can go all-in.