XRP Legal Battle: SEC Acknowledges Non-Security Status

Key Insights:

• SEC acknowledges digital assets like XRP aren’t inherently securities in court filing.
• XRP’s price has flipped previous support into resistance, support at $0.42; resistance at $0.61.
• Bitcoin’s price fails to make meaningful recovery, support at $25,000; resistance at $28,000.
• Ethereum’s price consolidates after sharp decline, support around $1,500; resistance at $1,757.

Bitcoin, Ethereum and XRP Forecast Video for 22.08.23 by Tim Smith

In a recent court filing, the U.S. Securities and Exchange Commission (SEC) has acknowledged that digital assets, including Ripple Labs’ native token XRP (XRP), are not inherently securities. This admission comes as part of the SEC’s appeal against a ruling in favor of Ripple.

The SEC stated in its appeal that it “does not seek appellate review of any holding relating to the fact that the underlying assets here are nothing but computer code with no inherent value,” thereby acknowledging that digital assets are not inherently securities. Pro XRP attorney John E. Deaton attributes the SEC’s shift in stance to a class action lawsuit leveled at the securities watchdog by 75,000 XRP investors. “I have to say there is no doubt 75k Ripple holders are a major reason the SEC is conceding this. We fought to have the judge actually write that the token itself is not the security. In fact, it was the first section in our argument in the brief,” Deaton tweeted to his 290,000 followers.

SEC’s Initial Appeal Game Plane

The SEC intended to appeal Judge Analisa Torres’ rulings on Ripple’s programmatic exchange sales of XRP and its distributions of XRP as payment for services, asserting that those offerings were not securities. However, it did not wish to appeal the court’s ruling that Ripple’s institutional XRP sales satisfied the Howey test, a tool used to determine whether an offer is an investment contract.

Last month, a New York judge ruled that XRP does not constitute a security. This ruling will likely set a precedent in cases filed by the SEC against Binance and Coinbase, two of the world’s largest centralized cryptocurrency exchanges. It may also help pave the way for issuers gaining regulatory approval for cryptocurrency spot exchange-traded funds (ETFs). Below, we use technical analysis to outline important trading levels in XRP, Bitcoin (BTC), and Ethereum (ETH).

Technical Analysis:  XRP, Bitcoin and Ethereum

XRP

After a liquidation-style capitulation below previous support at $0.54, XRP’s price has staged a modest recovery. However, that level has now flipped into resistance, with bears quick to book profits on the retest. Volume remains weak, increasing the risk of short-term volatility. A convincing close back above the closely-watched $0.54 level could see bulls make a run toward overhead resistance at around $0.61. Alternatively, further selling may see prices revisit the next level of lower support at $0.42.

Bitcoin

Since breaking down from a descending triangle, the King’s price has failed to make any sort of meaningful recovery. With lackluster trading volume accompanying the sharp sell-off, Bitcoin’s price too, is prone to short-term price fluctuations in either direction. Further selling could see falls to key longer-term support at the psychological $25,000 level. Conversely, a bargain hunters’ rally could spark a retrace to overhead resistance at $28,000.

Ethereum

Ethereum’s price also remains firmly in the bear’s grasp after Friday’s steep decline. Directionless choppy trade over the weekend appears like consolidation before the next big move. Another leg lower could see bears claw falls to crucial support slightly below the closely-watched $1,500 level. Alternatively, a breakout above the week’s range could see a move to $1,757, where the price finds a confluence of resistance from a previous support level and the falling 50-period SMA.