Over the past six months, the XRP community has been engulfed within the security versus ‘not a security’ debate. The same has been one of the prime focus of the ongoing legal battle between the blockchain company, Ripple Labs and the U.S. Securities and Exchange Commission.
The federal agency arguing that XRP is a security, according to attorney John E. Deaton, is quite absurd and hypocritical on its part. As a matter of fact, the SEC has time and again emphasized the fact that XRP is not the same as other cryptos like Bitcoin and Ethereum.
With respect to the status of the case, the court delivered two back-to-back blows to the agency. The SEC, now, has to reveal all its cards with respect to its internal trading policies. Commenting on the judgment, Deaton said,
“In the grand scheme of things, things been very fair and the last ruling was exactly the way it had to be.”
The SEC has been quite reluctant to divulge the policies that govern the trading acts of its office-bearers. Doing so, just makes them even more suspicious. Deaton further opined,
“What is wrong, why even fight? It’s a free democratic society, why do we not have that transparency?.. When you fight tooth and nail about things that you shouldn’t be fighting over, it just doesn’t give confidence.”
Emphasizing the need for even more transparency, Deaton stated,
“I’d like to know if the Chairman is allowed to hold Bitcoin or Ethereum or XRP or another digital token.”
The SEC recently shrugged off the notion that as an agency, it helped in developing market sentiment. What’s more, it stated that it was ridiculous for Ripple to contend so. However, Deaton said,
“To me that’s the most absurd thing that the SEC could say.”
According to the attorney, the SEC’s competitive mindset posed another major problem to the community. He stated,
“Sometimes, winning at all costs is not the right thing to do. I personally believe that the SEC’s attorney’s have gotten caught up in the battle – the battle of trying to beat this incredible legal team that Ripple has put together.”
Additionally, the SEC, on its part, is conflating the case by targeting the individual defendants – Chris Larsen and Brad Garlinghouse. After investigating the company for a couple of years before filing the lawsuit, the SEC did not find anything concrete against the individual defendants, and according to Deaton, the SEC should have just stuck to investigating the company. He concluded,
“They just threw everything and went as broad as they could to create as much as pain they could, in order to try to get Ripple to submit or come to their terms of settlement, and I think it backfired.”
“I’d like to know if the Chairman is allowed to hold Bitcoin or Ethereum or XRP or another digital token.”
XRP to the moon no more? Here’s what’s next for XRP
The latest round of developments in the ongoing Ripple v. SEC lawsuit saw the defendants request a deposition of a former SEC official – William Hinman. What followed soon after, however, was a motion filed by the SEC to deny the same request with a statement “these proposed inquiries… could be obtained by far less intrusive means.”
While both sides attempt to tilt the ruling in their favor, XRP has been buried under a mountain of selling pressure as part of a wider crypto sell-off. At the time of writing, XRP was being traded at $0.608 and down by 4% over the last 24 hours.
XRP Daily Chart
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Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice
The latest round of developments in the ongoing Ripple v. SEC lawsuit saw the defendants request a deposition of a former SEC official – William Hinman. What followed soon after, however, was a motion filed by the SEC to deny the same request with a statement “these proposed inquiries… could be obtained by far less intrusive means.”
While both sides attempt to tilt the ruling in their favor, XRP has been buried under a mountain of selling pressure as part of a wider crypto sell-off. At the time of writing, XRP was being traded at $0.608 and down by 4% over the last 24 hours.
XRP Daily Chart
Source: XRP/USD, TradingView
A descending triangle breakdown hampered XRP’s movement as losses piled up to 40% from the lower trendline to the $0.48-support. A temporary recovery was noted by the market, but the altcoin’s price failed to hike above the 200-SMA (green) and moved back towards $0.60, at the time of writing. The focus now shifted to the defensive line of $0.54, but the region was at the risk of a breakdown.
Reasoning
XRP moved below its 200-SMA for the first time since December 2020 due to persistent downwards pressure. Now that the long-term moving average no longer offered support to the alt’s price, bearish sentiment can continue to accumulate.
The Relative Strength Index was in bearish territory and while a move into the oversold zone could result in a slight recovery, the index has failed to rise above 50 over the past month. If this continues, XRP would see lower levels in the coming week. Bearish momentum was on the up, according to the Awesome Oscillator, something that confirmed with XRP’s price action.
The Directional Movement Index highlighted the bearish trend as the -DI line maintained itself above the +DI line, while an ADX reading of 36 suggested that the market was strongly directional.
A close below $0.54 would see XRP challenge the $0.48-support once again. The Visible Range’s point on control indicated that interest for XRP was at its peak at $0.472 in the given timeframe and hence, a sharper breakdown can be avoided. In case this level crumbles in the face of selling pressure, XRP could find relief around the late-February levels of $0.35-0.40.
Conclusion
XRP can be projected to head back towards its 22 June swing low of $0.48 over the coming days. A minor rally may even offer some respite, but this zone can be expected to be in play over the coming week. A close below this point could drag the cryptocurrency towards another defensive area of $0.35-$0.40.
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