SEC Drops Ripple Appeal, XRP Surges 15%

The Securities and Exchange Commission (SEC) has dropped its appeal in the Ripple case, marking a significant development in the ongoing legal battle between the regulator and the fintech company. The proceedings, which lasted over four years, have finally come to an end with the SEC's decision to dismiss the suit against Ripple's CEO Brad Garlinghouse and co-founder Chris Larsen. The court had previously ruled that programmatic sales and other distributions of the Ripple token did not constitute an offer and sale of investment contracts, but the marketing of the coins to large players violated securities laws.

In August 2024, Judge Analisa Torres issued a final judgment in the case, fining Ripple $125 million. The regulator originally claimed $2 billion. In October, the SEC contested the verdict, proposing to revisit offerings and sales of XRP on digital asset platforms, Garlinghouse's and Larsen's involvement, and distributions of the token "in exchange for consideration other than cash." However, the court dismissed the SEC's interlocutory appeal, finding that it lacked sufficient evidence and that its consideration would not "materially advance the ultimate dismissal of the case."

Garlinghouse, reflecting on the case, stated that it was "doomed from the start" and represented the first major shot in the war against cryptocurrencies. He emphasized that Ripple proved to be the first company with the resources, determination, and grit to fight the regulator's overreach. The entrepreneur thanked industry participants for Ripple's support during the proceedings with the regulator, making a special mention of the role of the company's general counsel Stuart Alderoti. Alderoti has already stated that the firm will consider how "best to file a cross-appeal" with the SEC.

The news of the SEC dropping its appeal has had a significant impact on the cryptocurrency market, with the price of XRP surging by approximately 15%. The price of the token rose to levels near $2.6, reflecting the market's positive reaction to the development. The crypto community has also reacted positively, with many investors and industry figures congratulating the Ripple team on their victory. The former chairman of the U.S. Federal Government Commodity Futures Trading Commission, Chris Giancarlo, extended his congratulations to the developers of Ripple, as did Coinbase crypto exchange founder Brian Armstrong and former U.S. presidential communications aide Anthony Scaramucci, among others.

Many members of the cryptocommunity are confident that XRP will rise in value on the back of the news. The growth of the Ripple cryptocurrency, according to optimists, will also help the launch of ETFs based on the coin. Different predictions are heard online, with some expecting XRP to reach $20, while others believe the cryptocurrency will soon be worth hundreds of dollars. The DMI chart for XRP shows a notable shift, with the ADX (Average Directional Index) rising to 20.4 from 15.64 following the news that the SEC has withdrawn its lawsuit against Ripple. This rise indicates a strengthening market trend. Additionally, the +DI rose from 18.3 to 39, while the -DI fell from 19.63 to 12.97, indicating a clear bullish divergence. The surge in buying activity (+DI) and weakening bearish signal (-DI) confirm that XRP is looking to maintain and develop an uptrend. If this trend continues, we can expect further gains in the near term thanks to the strengthening bullish momentum.

Activity in the XRP network has increased significantly, with the number of active addresses reaching a record 1.19 million over the past seven days. This growth in the number of active addresses is a signal that the XRP blockchain is attracting more participants, including retail traders and institutional investors. Such dynamics may also portend an inflow of new capital into the cryptocurrency. While this doesn't guarantee an immediate price increase, online activity could support the XRP price and reduce downside risks, especially when combined with other positive technical or fundamental factors. At the time of writing this analysis, XRP traded at $2.41. The growth of the token over the last day amounted to 8.3%. The EMA lines are now pointing to the possible formation of a new "golden cross" in the near future. On the other hand, if the XRP price fails to stay above the current range, a new downtrend may start. In this case, the support level at $2.37 will be key. A break below this level could increase downsides risks for XRP: then the price would retest $2.21 and possibly $1.90.