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XRP News: Coinbase’s Legal Maneuvers and the OIG May Shake SEC’s Grip on Crypto

By:
Bob Mason
Updated: Feb 26, 2024, 02:15 UTC

Key Points:

  • On Sunday, XRP declined by 0.46%, ending the session at $0.5427.
  • Uncertainty about the SEC's plans to appeal the ruling on Programmatic Sales of XRP continued to affect market sentiment.
  • On Monday, SEC v Coinbase case-related updates and US lawmakers need consideration.
XRP News

In this article:

The Sunday Overview

On Sunday, XRP declined by 0.46%. Partially reversing a 2.06% gain from Saturday, XRP ended the Sunday session at $0.5427.

A Week of Anticipation: Coinbase and SEC Plans to Appeal SEC v Ripple Court Rulings

It could be a pivotal week for the SEC v Ripple case and the US digital asset space. The crypto community awaits the court ruling on the Coinbase (COIN) Motion to Dismiss (MTD).

Coinbase filed the MTD in August, arguing the SEC lacks the statutory authority to regulate crypto exchanges. US Treasury Secretary Janet Yellen inadvertently assisted Coinbase and its MTD.

On February 10, Treasury Secretary Yellen called on Congress to pass legislation for stablecoin and the spot crypto market regulations. The call for legislation highlighted the lack of legislation to assign oversight responsibilities to US regulators.

Should the court grant Coinbase’s Motion to Dismiss, the SEC will likely appeal against the ruling. Nonetheless, the ruling could force the SEC to end its regulation through enforcement reign over the US crypto market.

An unfavorable ruling for the SEC could impact its decision to appeal the Programmatic Sales of XRP ruling. In July, Judge Analisa Torres ruled programmatic sales of XRP do not satisfy the third prong of the Howey Test.

SEC plans to appeal against the Programmatic Sales ruling mean the SEC is unlikely to settle the SEC v Ripple case. However, the outcome of an ongoing investigation into possible crypto conflicts of interest within the SEC could force the SEC into a settlement.

Office of Inspector General, the SEC, and Bill Hinman

Scrutiny of SEC activity intensified in recent weeks. On February 15, non-profit US government watchdog Empower Oversight announced the Office of Inspector General was nearing the end of an investigation into crypto conflicts of interest within the SEC.

The OIG investigation focuses on former SEC Director William Hinman. Empower Oversight claims Hinman received millions of dollars from his former employer while guiding SEC crypto regulations. Simpson Thacher is part of a group that promotes Enterprise Ethereum. Hinman famously said Bitcoin (BTC) and Ethereum (ETH) are not securities.

During the SEC v Ripple case, Hinman speech-related documents revealed Hinman continued to meet with Simpson Thacher despite warnings from the SEC Ethics Division. After leaving the SEC, Hinman returned to Simpson Thacher.

If the OIG finds conflicts of interest, the SEC may settle the Ripple case. Since December 2020, the SEC made at least six attempts to shield the documents under attorney-client privilege. SEC will not want Ripple to present the documents at trial

As the investigation by the OIG progresses, its findings may have significant implications for the ongoing SEC v Ripple case.

XRP Price Action

Weekly Chart sends bullish longer-term price signals.
XRPUSD 260224 Weekly Chart

Daily Chart

XRP remained below the 50-day and 200 EMAs, affirming bearish price signals.

An XRP break above the $0.5470 resistance level and 50-day EMA would support a move to the 200-day EMA. Selling pressure could intensify at the $0.5470 resistance level. The 50-day EMA ($0.5485) is confluent with the $0.5470 resistance level.

SEC v Coinbase case-related updates and the OIG Investigation need consideration.

However, a break below the $0.5350 handle would support a fall toward the $0.5042 support level.

The 14-day RSI reading, 50.62, suggests an XRP return to the $0.5835 resistance level before entering overbought territory.

XRP Daily Chart sends bearish price signals.
XRPUSD 260224 Daily Chart

4-Hourly Chart

On the 4-hourly, XRP sat below the 50-day and 200-day EMAs, reaffirming bearish price signals.

A break above the 200-day EMA would support a move to the 50-day EMA and the $0.5470 resistance level.

However, a drop below the $0.5350 handle would give the bears a run at the $0.5042 support level.

The 4-hourly RSI, with a reading of 45.81, suggests an XRP fall to the $0.5042 support level before entering oversold territory.

XRP 4-Hourly Chart affirms bearish price signals.
XRPUSD 260224 4-Hourly Chart

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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