XRP News: Investor Bets on a Ripple Victory Send XRP Toward $0.70

Bob Mason
Published: Nov 6, 2023, 02:49 GMT+00:00

Speculation surrounding the likely outcome of the SEC v Ripple case fueled buyer demand for XRP. Lawyers Deaton and Hogan shared their perspectives.

XRP News

In this article:

Key Insights:

  • XRP saw a 7.41% rally on Sunday, ending the session at $0.6611.
  • Investor sentiment regarding the SEC v Ripple case fueled buyer demand on Sunday.
  • On Monday, the narrative will likely remain if there are no updates on the SEC v Ripple case.

The Sunday Overview

On Sunday, XRP rallied 7.41%. Following a 0.51% gain on Saturday, XRP ended the week up 18.9% to $0.6611.

Optimism Surrounding a Ripple Victory Against the SEC Boosts Gains

Market optimism toward a Ripple victory in the ongoing SEC v Ripple case fueled buyer appetite on Sunday. There were no updates from the ongoing case to impact investor sentiment.

On Sunday, attorney and partner at Hogan & Hogan Jeremy Hogan shared his views on the SEC v Ripple case. Hogan discussed the matter of disgorgement, with the SEC targeting an eyewatering $770 million penalty for the illegal sales of XRP to institutional investors.

Hogan noted that the law permits the SEC to seek disgorgement, interest, and penalties. The matter of disgorgement comes following the Court ruling that approximately $770 million in XRP sales to institutional investors was illegal.

The Ripple Arguments on Disgorgement

Hogan suggested Ripple has two arguments in the matter, saying,

“First, the SEC v Liu case (2020) basically said that disgorgement is an equitable remedy, which means that it should be fair. And fair in this context means that it should be the violations NET profits, not GROSS. So, Ripple will deduct business expenses from the total.”

Presenting the second argument, Hogan said,

“As was recently upheld in the 2nd DCA, the amount of disgorgement must be awarded for the victims. Victims means individuals/entities who lost money on an investment. So, if an XRP purchaser paid $0.30 and the price is now $0.60, they are not a victim and therefore no disgorgement.”

Hogan went on to say,

“Finally, the SEC has to provide some nexus between the purchaser of XRP and the United States. In other words, if Ripple sold XRP to a German investment company with no ties to the US, the SEC has no jurisdiction over that sale. The nexus question will be interesting.”

Hogan noted that the SEC can estimate disgorgement damages and place the burden of proof on Ripple to refute it. Furthermore, he pointed out that the SEC might argue that Ripple incurred expenses that contributed to further violations. In such cases, the SEC may advocate to exclude these expenses when calculating net profits.

Lawyers Ease Fears of a $770 Million Penalty

Two lawyers viewed it unlikely for the SEC to get close to a $770 million penalty.

Jeremy Hogan summed up his assessment of the case, saying,

“In conclusion, $770 million is NOT going to be $770 million, but something much less.”

On Saturday, CryptoLaw US founder and amicus curiae attorney John E. Deaton shared his perspective, stating,

“The people who’ve argued that the SEC got a 50-50 victory in the Ripple case are 100% wrong. It was more like 90-10 in Ripple’s favor. If Ripple ends up paying $20M or less it’s a 99.9% legal victory.”

Hogan presented a plausible argument when considering investors were not out of pocket, unlike other cases involving hefty disgorgement penalties. Regarding the question of whether XRP qualifies as a security, Hogan made an intriguing observation,

“[…] how rare is it that the SEC sues a company for selling an unregistered security and during the litigation the price of the security increases? Very rare. And that might be another indication that the security is… not a security.”

XRP Price Action

Weekly Chart sends bullish price signals.
XRPUSD 061123 Weekly Chart

Daily Chart

XRP held above the 50-day and 200-day EMAs.

An XRP move through the Monday high of $0.6887 would support a move to the $0.7047 resistance level.

The SEC v Ripple case and speculation about the outcome remain focal points on Monday.

However, an XRP return to $0.65 would bring the $0.6354 support level into play.

The 14-day RSI reading of 85.43 shows XRP sitting in overbought territory. XRP could face intensifying selling pressure without further XRP-related catalysts.

XRP Daily Chart EMAs send bullish price signals.
XRPUSD 061123 Daily Chart

4-Hourly Chart

In the 4-hourly Chart, XRP remains above the 50-day and 200-day EMAs.

An XRP return to $0.68 would give the bulls a run at the $0.7047 resistance level.

However, a fall below $0.66 would support a move toward the $0.6354 support level.

The 4-hourly RSI, with a reading of 81.56, shows XRP sitting in overbought territory. Selling pressure will likely intensify without an XRP-friendly event.

XRP 4-Hourly Chart EMAs affirm bullish price signals.
XRPUSD 061123 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.

Did you find this article useful?