In December 2020, the SEC filed a lawsuit against Ripple Labs, accusing it of conducting an unregistered securities offering by selling XRP. Ripple Labs fought back and recently achieved a partial victory. U.S. District Court Judge Analisa Torres ruled on July 13 that XRP is not a security when sold to the general public. This decision was met with great enthusiasm by XRP token holders and resulted in a significant increase in the token’s price. This partial victory against the SEC has led to speculation about whether XRP is now a top investment choice.
Wait Before Buying XRP Now
In Ripple Lab’s ongoing legal tussle with the SEC, a federal judge has determined that the XRP token does not conform to the criteria established for a security. However, Ripple’s sales of XRP worth $729 million to institutions were deemed as unregistered securities offerings, thus breaching securities law.
The SEC’s lawsuit against Ripple is set to proceed, with a jury deciding if Ripple executives knowingly participated in the unlawful offering of XRP to institutional investors.
While the recent ruling for XRP is encouraging, numerous cryptocurrency attorneys caution against premature celebration. Stephen Palley, a partner at the law firm Brown Rudnick, pointed out that the summary judgment is merely partial. Furthermore, Judge Torres’ ruling doesn’t establish a legal precedent. It may, at best, provide influential insight for future courts to consider, should they decide to do so.
Palley, among others, highlighted the possibility that the SEC could choose to appeal the decision. This introduces the potential for a superior court to reverse the judgments handed down by Judge Torres.
Hence, Coinpedia recommends investors exercise caution and refrain from investing at the current peak prices, as there’s a risk of a sudden price reversal leading to substantial losses. Investing in XRP could become more profitable after a definitive victory against the SEC.
What’s Next For XRP Price?
XRP surged past multiple key resistance levels, indicating a bullish trend as the price touched a high of $0.938. However, the bullish trend was short-lived as the XRP price quickly made a bearish reversal.
XRP price experienced a profit-taking momentum at around $0.94 and followed a sharp bearish rally. Due to a massive surge in liquidation, the price dropped below multiple Fib channels and took support near the bottom level of $0.668. Bulls will aim to limit any pullback within the zone below the 38.2% Fibonacci retracement level at $0.63.
If the price surges and continues to trade above $0.75, it will strengthen bulls’ confidence and prevent the price from dropping to a bearish channel. A surge toward $0.9 might again see profit booking among traders.
If the price remains below $0.75, the price could retest the support at $0.6. A drop below this level might push the price to the 61.8% retracement level, potentially delaying the next uptrend’s onset.