Advertisement
Advertisement

XRP News Today: Will Ripple or the SEC Settle? Forecasts and Legal Insights

By:
Bob Mason
Updated: Jun 17, 2024, 00:46 GMT+00:00

Key Points:

  • On Sunday (June 16), XRP declined by 0.27%, ending the session at $0.4892.
  • Uncertainty about the SEC vs. Ripple case left XRP trailing the broader crypto market.
  • On Monday (June 17), investors should monitor SEC vs. Ripple case-related news amidst ongoing speculation about a settlement.
XRP News Today

In this article:

The Sunday Overview

On Sunday (June 16), XRP declined by 0.27%. Partially reversing a 3.50% rally from Saturday (June 15), XRP ended the week down 1.77% at $0.4892.

SEC vs. Ripple: Settlement Speculation Intensifies

On Sunday, the SEC vs. Ripple case continued to grab the crypto news headlines. Speculation about an SEC settlement offer drove XRP to a weekend high of $0.5049 before hitting the reverse.

Investors continued to debate the SEC response to the Ripple Notice of Supplemental Authority.

The latest filings related to the SEC settlement with Terraform Labs. Ripple arrived at a $10 million penalty for breaching US securities laws. However, the SEC calculated a penalty floor of $102.6 million by applying the terraform labs ratio to the $876.3 million in gross profits from illegally selling XRP to institutional investors.

Significantly, the SEC considered total gross profits of $876.3 million in its $102.6 million penalty floor calculation. However, Ripple could reduce the $876.3 million by removing profits from XRP sales to non-US institutional investors.

In Morrison vs. NAB, the US Supreme Court ruled that the SEC only has jurisdiction over US-based sales. If the vast majority of XRP sales were to non-US institutional investors, the starting point for the penalty floor calculation could be significantly lower.

Furthermore, considering the Supreme Court ruling, SEC references to post-complaint conduct in its Friday filing may also be inappropriate if Ripple can demonstrate that post-complaint XRP sales were to non-US institutional investors.

Amidst the speculation of a settlement, there are two issues to consider.

Firstly, would Ripple want to settle at this late juncture and for a sum far greater than $10 million? Secondly, why would the SEC offer a settlement significantly lower than the almost $2 billion and remove the option for an appeal?

An SEC Settlement Would End SEC Plans to Appeal

In August 2023, the SEC filed a Motion for Interlocutory Appeal to contest the Programmatic Sales of XRP ruling. In July 2023, Judge Analisa Torres ruled that programmatic sales of XRP do not satisfy the third prong of the Howey Test.

However, Judge Analisa Torres rejected the Motion for Interlocutory Appeal in October 2023, forcing the SEC to file an appeal at the end of the case.

Since the court ruling, the SEC has expedited the SEC vs. Ripple case, dropping the charges against CEO Brad Garlinghouse and co-founder Chris Larsen.

While the SEC has remained silent on plans to appeal, an appeal is likely unless the Biden Administration applies political pressure. A favorable settlement and an end to plans to appeal against the Programmatic Sales of XRP ruling could fuel buyer demand for XRP. Moreover, Biden pressure could attract some of the crypto vote to the Democrats.

XRP Price Action

XRP Daily Chart sends bearish price signals.
XRPUSD 170624 Weekly Chart

Daily Chart

XRP sat well below the 50-day and 200-day EMAs, confirming the bearish price trends.

An XRP move through the trend lines could give the bulls a run at the 50-day EMA. A break above the 50-day EMA could signal a climb to the 200-day EMA.

Investors should monitor SEC vs. Ripple case-related news and SEC activity.

Conversely, an XRP fall through $0.48 could give the bears a run at the $0.45 handle.

The 14-day RSI reading of 41.83 indicates an XRP drop to the $0.45 handle before entering oversold territory.

Daily Chart affirms the bearish price signals.
XRPUSD 170624 Daily 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?

Advertisement