XRP News Today: Ripple Faces Appeal Threats as ETF Hopes Hang in Balance; BTC at $103k

SEC vs. Ripple Ruling Sends XRP Lower as Legal Uncertainty Builds

The fallout from Thursday’s court ruling in the ongoing SEC vs. Ripple case left XRP under pressure on Friday, May 16. Judge Analisa Torres surprised the crypto market, denying the SEC and Ripple’s request for an indicative ruling on lifting the injunction prohibiting XRP sales to institutional investors. The motion also requested a lower penalty for violating US securities laws. The ruling caught the crypto market off guard and reignited legal uncertainty.

Notably, the power to dictate next steps now lies with the court, not the Trump administration or the SEC. This twist adds a new layer of complexity to an already prolonged legal saga.

SEC and Ripple Appeals Still on the Table

On May 16, Crypto America host and journalist Eleanor Terrett reported:

“After speaking with three legal sources and tuning into John E. Deaton’s live analysis, my read is that Judge Torres is playing hardball here – she’s not making it easy for the parties to simply walk away; instead, she’ll make them work for it.”

Amicus Curiae attorney John E. Deaton explained that the court spent five years on the case, only for the SEC to reverse its stance. He suggested the SEC would need to publicly admit its position was flawed and that XRP is a commodity, not a security. Any motion to lift the injunction must convincingly argue that doing so and reducing the penalty serves institutional investors and the public.

Barring any political motivations, Deaton thinks Judge Torres will approve a re-filed motion, but it may take several months.

Judge Torres may also be mindful of the recent court filing in Oregon, reopening the SEC’s case against Coinbase (COIN). A deepening partisan divide could prompt other Democratic-led states to re-examine crypto enforcement, intensifying legal risks for the broader market..

Ripple’s Legal Path: Settlement or Supreme Court?

The court ruling has retriggered market anxiety about XRP’s future. If the parties cannot convince Judge Torres that a settlement benefits the public, the legal battle may continue.

Ripple could proceed with its cross-appeal, and the SEC may pursue its appeal against the Programmatic Sales of XRP ruling. In July 2023, Judge Analisa Torres ruled that programmatic sales of XRP did not satisfy the third prong of the Howey Test. The ruling had buoyed optimism about a US XRP-spot ETF market.

If the SEC appeals and successfully overturns the ruling, it could close the door on US-XRP-spot ETF approvals and the case could reach the US Supreme Court. The potential for a Supreme Court ruling remains a significant risk factor for both parties, especially since such a ruling would establish binding precedent for the entire cryptocurrency industry.

Investors should also consider a timeline pressure point. The SEC and Ripple must submit a status report on the settlement to the courts by June 16. If Judge Torres has yet to grant the motion for an indicative ruling, the US Court of Appeals may force the SEC and Ripple to either proceed with their appeals or drop them.

The bigger question is whether Ripple stands firm on a settlement being a prerequisite to withdrawing its cross-appeal. If Ripple proceeds, the SEC may follow suit.

XRP Price Outlook: Focus on Legal Developments

XRP slipped 0.31% on Friday, May 16, adding to Thursday’s 6.5% sell-off, closing at $2.3791. The token tracked the broader crypto market, which dropped 0.36% to a total crypto market cap of $3.25 trillion.

XRP’s near-term price outlook hinges on future court filings, court rulings, and sentiment toward an XRP-spot ETF market.

Technical support sits at $2.3. A break above the May 12 high of $2.6553 could signal a move toward $3.00, with the potential to reach the record high of $3.5505.

For a deeper dive, see our full XRP forecast here.

Bitcoin Holds Above $100,000 Despite Credit Downgrade

Bitcoin (BTC) joined XRP and the broader market in the red. US economic indicators boosted Fed rate cut bets and demand for risk assets on May 15. The Michigan Consumer Sentiment Index unexpectedly fell from 52.2 in April to 50.8 in May, signalling a potential pullback in consumer spending. Weaker spending may dampen inflation, supporting a more dovish Fed rate path. BTC climbed to a May 15 high of $104,616.

However, Moody’s downgrade of the US’s coveted Aaa credit rating to Aa1 highlighted the potential risks of rising debt and borrowing costs, pressuring risk assets.

Still, US BTC-spot ETF market flows cushioned the downside. The US BTC-spot ETF market could extend its inflow streak to three sessions on May 16. According to Farside Investors:

• Fidelity Wise Origin Bitcoin Fund (FBTC) saw net inflows of $67.9 million.
• ARK 21Shares Bitcoin ETF (ARKB) reported net inflows of $58 million.

Excluding pending flow data for BlackRock’s (BLK) iShares Bitcoin Trust (IBIT), the US BTC-spot ETF market saw total inflows of $130.5 million. IBIT reported net inflows of $409.7 million on May 15, keeping the inflow streak alive.

BTC Price Outlook: Monitor Washington and ETF Trends

BTC slipped 0.26% on May 16, reversing a 0.24% gain from the previous session to close at $103,545.

BTC’s price outlook hinges on several key drivers: the upcoming GENIUS Act vote, trade headlines, US economic data, and ETF flows.

Potential scenarios:

• Bearish Scenario: Re-escalation in US-China trade war, weak Services PMI data, a failed GENIUS Act vote, and ETF outflows. Bearish sentiment could send BTC toward $90,000.
• Bullish Scenario: Easing trade tensions, positive Services PMI numbers, GENIUS Act vote passes Congress, and ETF inflows. Bullish sentiment could drive BTC above the record high of $109,312.

What to Watch

Investors should closely watch the Ripple case, regulatory developments, and macroeconomic indicators. These will influence market sentiment and determine whether XRP and BTC can extend their bullish trends.

Read analysts’ insights on what could drive cryptocurrencies to new highs.