XRP News: Rally Sparks Amidst SEC Scrutiny and Ripple Lawsuit

Key Insights:

• XRP rallied 4.57% on Thursday, ending the session at $0.5624.
• Increasing scrutiny of SEC activity and unethical SEC practices fueled buyer demand for XRP.
• On Friday, SEC Chair Gary Gensler-related news and SEC v Ripple and Coinbase case-related updates need consideration.

The Thursday Overview

On Thursday, XRP rallied 4.57%. Following a 2.48% gain on Wednesday, XRP ended the session at $0.5624. Significantly, XRP briefly revisited the $0.57 handle for the first time since January 17, 2024.

SEC Credibility and the SEC v Ripple Case

There were no SEC v Ripple case-related updates to fuel the breakout Thursday session. Ripple and the SEC are nearing the end of remedies-related discovery. Discovery relates to XRP sales to US institutional investors.

In July 2023, Judge Analisa Torres ruled that Ripple should have registered XRP sales to institutional investors as a security under Section 5 of the US Securities Act.

The lack of updates from the SEC and Ripple has redirected focus to the SEC and its lawmaker capabilities.

Amicus curiae attorney and CryptoLaw US founder John E Deaton reacted to an SEC Chair Gary Gensler interview on Squawk Box, stating,

“He has been proven wrong on the law over and over, now he’s basically waging some kind of propaganda war against an industry because he can’t win in court to get crypto under his regulatory thumb. How is this guy in charge of protecting our markets?”

During a Squawk Box interview, SEC Chair Gensler had this to say about cryptos,

“This is a field that has been rife with fraud and manipulation. And look at all the bankruptcies. […] It’s not just one entity. It’s entity after entity after entity, and then investors are just lining up in the bankruptcy courts.”

The Jamie Dimon rant about crypto became a topic of discussion during the interview. JPMorgan Chase CEO Jamie Dimon famously said,

“If I was the government, I would close it down.”

Chair Gensler had this to say about the illicit use of crypto,

“It’s the leading market share in ransomware, and that’s publicly known. It’s the token of choice for ransomware.”

SEC Chair Gensler may be on a public relations campaign to limit the damage from the SEC v Debt Box case.

SEC v Debt Box, a Tarnished Reputation, and Plans to Appeal

In December 2023, the presiding Judge in the SEC v Debt Box case ordered the SEC to show why the court should not sanction the SEC for making false and misleading misrepresentations to the court.

On January 30, 2024, the SEC filed a Motion to Dismiss the charges against Debt Box. In February 2024, five US Senators co-signed a letter to SEC Chair Gensler. Significantly, the Senators threatened scrutiny of its other enforcement cases.

The increased scrutiny of SEC activity and the rising number of SEC transgressions in the courts could influence Judges in SEC v crypto cases. Significantly, the SEC may lose its freedom to target US crypto firms in the US courts.

After Judge Analisa Torres decides on the penalty for XRP sales to US institutional investors, investors anticipate that the SEC will appeal the ruling on Programmatic Sales of XRP. In July 2023, Judge Torres ruled that programmatic sales of XRP did not satisfy the third prong of the Howey Test.

The possible threat to SEC plans to appeal against the Programmatic Sales ruling may have contributed to buyer demand for XRP. XRP trailed the broader crypto market in 2023 and continues to do so in 2024. Year-to-date, XRP was down 7.48% on Friday. The total crypto market cap was up 18.74%.

XRP Price Action

Daily Chart

XRP hovered above the 50-day and 200-day EMAs, sending bullish price signals.

An XRP move through the Thursday high of $0.5772 would bring the $0.5835 resistance level and $0.60 handle into play.

SEC-related chatter, SEC v crypto case-related news, and BTC-spot ETF market updates need consideration.

However, a drop below the 200-day EMA would support a fall to the 50-day EMA and the $0.5470 support level. Selling pressure could intensify at $0.5480. The 50-day EMA ($0.5487) is confluent with the $0.5470 support level.

The 14-day RSI reading, 63.29, suggests an XRP break above the $0.5835 resistance level before entering overbought territory.

4-Hourly Chart

On the 4-hourly, XRP remained above the 50-day and 200-day EMAs, affirming bullish price signals.

A break above the Thursday high of $0.5772 would give the bulls a run at the $0.5835 resistance level and the $0.60 handle.

However, a drop below the $0.56 handle would bring the $0.5470 support level into play.

The 4-hourly RSI, with a reading of 75.15, shows XRP in overbought territory. Selling pressure could intensify at $0.57.