XRP closed at $0.5037 on Saturday, dodging a dip below $0.50 for the first time since August’s end.
Ripple’s Chief Legal Officer, Alderoty, counters the SEC’s claims of “knotty legal problems.”
Ripple and Coinbase cases are US crypto game-changers.
Saturday’s Overview of XRP
XRP fell by 0.26% on Saturday. Following a 0.04% loss on Friday, XRP ended the day at $0.5037. Despite the loss, XRP avoided a return to sub-$0.50 for the first time since August 30.
The Crypto Community Reacts to SEC Reply Memorandum Filing
The US Securities and Exchange Commission (SEC) was the topic of discussion on Saturday. Investors and the crypto community continued to react to the SEC’s Reply Memorandum filing.
The Reply Memorandum allows the SEC to respond to the Ripple opposition filing to the SEC’s motion for interlocutory appeal.
Certain sections of the Reply Memorandum raised eyebrows. While justifying the appropriateness of an interlocutory appeal, the SEC stated an interlocutory appeal was necessary to address the Defendants’ intentions to prolong the case “so that they may continue selling XRP into public markets.”
The SEC referred to Judge Torres’ ruling on Programmatic Sales, noting the Court’s order on summary judgment presented “knotty legal problems”.
Ripple Chief Legal Officer Stuart Alderoty reacted to the SEC’s arguments, saying,
“Another SEC filing, another hypocritical pivot… After years of its chairman saying the “rules are clear and must be obeyed” the SEC now cries that an appeal is urgently needed to resolve these “knotty legal problems.”
Investors must now await Judge Torres’s ruling on the SEC’s motion for interlocutory appeal. Legal experts expect the appeal process to take one to two years, during which time, as per the SEC’s request, the Court would pause the ongoing SEC v Ripple case.
Coinbase and Ripple Are Pivotal Cases for the US Crypto Market
The crypto market now has two pending Court rulings that could materially alter the US crypto landscape.
A Judge Failla ruling on the Coinbase (COIN) motion to dismiss (MTD) could prove pivotal. The SEC alleges Coinbase operates as an unregistered securities exchange, broker, and clearing agent.
Should Judge Failla, the presiding Judge in the SEC v Coinbase case, grant the MTD, the SEC will face a second ruling that offers judicial clarity on whether cryptos are securities.
In April, SEC Chair Gary Gensler categorized all cryptos, except BTC, as securities. At the time, Ripple CLO Alderoty reacted to the statement, saying that Gensler should recuse himself from involvement in enforcement cases that question the classification of cryptos “since he has prejudged the outcome.”
A favorable ruling on the Coinbase MTD and Judge Torres denying the SEC’s motion for interlocutory appeal could raise questions over the SEC’s oversight of the crypto market. Judicial rulings that do not classify cryptos as securities may also force US lawmakers to hastily address the regulatory gap that plagues the US digital asset space.
XRP Price Action
XRPUSD 100923 Weekly Chart
It was a notably rangebound Saturday session, with XRP moving within a $0.0035 range. Uncertainty surrounding the outcome of the SEC motion for interlocutory appeal leaves XRP hovering at the $0.5042 support level. Failure to break out from the $0.5042 would leave sub-$0.48 in play.
However, a breakout from the $0.5042 support level would bring the trend line and 200-day EMA into view. XRP would need Court rulings to support a break above the trend line. The 200-day EMA is confluent with the trend line, signaling selling pressure at the $0.5250 level.
The 35.16 14-Daily RSI reading indicates XRP can return to $0.48 before hitting oversold territory.
XRPUSD 100923 Daily Chart
XRP remains below the 50-day and 200-day EMA, reaffirming the bearish price signals. However, a breakout from $0.5042 support level and the 50-day EMA would bring the trend line into play.
Favorable Court rulings would support an XRP break above the trend line to target the 200-day EMA. Uncertainty toward the outcome of the SEC cases against Ripple and Coinbase remains headwinds. Rulings against Ripple and Coinbase would bring the $0.4322 support level into view.
The 14-4H RSI 48.91 reading shows XRP has room to fall before entering oversold territory.
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.