Ripple Labs scored another victory in court against the U.S. SEC on Wednesday, adding to a series of favourable outcomes in the ongoing legal battle.
The long-anticipated conclusion of the settlements phase in Ripple Labs’ trial resulted in a much smaller fine than the SEC had sought. U.S. District Court Judge Analisa Torres of the Southern District of New York (SDNY) set the penalty at just over $125 million, a far cry from the $2 billion the SEC had requested.
In response, investors rallied behind Ripple, propelling XRP up the crypto market cap leaderboards. By mid-afternoon Thursday, XRP led 24-hour gains among all assets, posting a 24% increase in price. XRP surged from support at $0.50 to encounter resistance at the $0.62 level.
Ripple Court Wins Propel XRP Price
Here’s a quick overview of the timeframe and market performance of XRP following Ripple’s major victory against the SEC last year. Traders had only a few days to capitalize on these returns:
On July 13 of last year, Judge Torres ruled that Ripple Labs had not violated securities laws through XRP sales on public exchanges. Following the ruling, RippleNet token prices soared by over 75% during intraday trading that Thursday.
XRP’s price surged from $0.48 on July 13 to a local high of $0.794 on crypto exchanges before stabilizing around the $0.50 support level by August 17, where it remained until late October.
While the situation could unfold differently this time, especially as the case appears to be nearing its final conclusion, the SEC still has the option to appeal the court’s ruling. Under Chairman Gary Gensler’s leadership, the U.S. regulator has displayed a particular determination and hostility toward San Francisco-based Ripple Labs and its XRP. If the asset follows last year’s trajectory, there may be further potential for XRP to rise beyond the $0.60 level in August.
However, if the market has already factored in a favorable ruling, this latest development could turn into a “sell the news” scenario for Ripple, despite the initial 24% surge earlier this week.
“As soon as we see a move above $0.66, you can quickly expect [XRP price] to hit $1.03, a mid-level target,” noted former Ripple price analyst Dark Defender.
In the meantime, here are five long-term supports for XRP markets that Web3 investors and altcoin traders might want to consider:
1. U.S. Reduces Ripple Fine from $2 Billion to $125 Million
To gauge the potential impact of the recent SDNY ruling on Ripple, a comparison to BNB’s settlement with the government last November might be insightful. After facing a massive $4 billion fine, BNB quickly rallied, as markets with strong confidence in Binance’s operations shrugged off the penalty. It took several months, but Binance’s native token eventually reached a new all-time high earlier this year.
Ripple’s $125 million fine, comparatively minuscule, can be seen as a strong validation of the legality and regularity of the company’s operations. This could entice more cautious investors, both in the U.S. and globally, to explore XRP. Ripple Labs CEO Brad Garlinghouse highlighted that the SEC’s reduction of the fine by roughly 94% recognized that they had “overplayed their hand,” calling it a victory for Ripple, the industry, and the rule of law.
2. Ripple ETF and IPO by 2025?
Garlinghouse has hinted that a Ripple IPO could occur by 2025, with the recent court victory bringing this possibility closer to reality. He also suggested that a Ripple ETF is inevitable, driven by demand from regulated investors. In a June interview on Fox Business, Garlinghouse pointed out that investors prefer diversified exposure rather than concentrating on a single asset, reminding audiences that XRP was once the second most valuable digital asset before the SEC got involved.
In a May 2022 interview with CNBC, Garlinghouse mentioned that Ripple would explore an IPO once the SEC lawsuit concluded. The recent SDNY court ruling has now brought Ripple Labs and XRP holders closer to this goal. Ripple Founder Chris Larsen remarked that the SEC’s aggressive campaign against Ripple is finally over, expressing hope that this marks the end of the current administration’s stance on crypto.
3. XRPL Expands Ripple into DeFi
While XRP is often viewed as a centralized finance (CeFi) token due to the platform’s design, the XRP Ledger (XRPL) extends Ripple’s capabilities into the decentralized finance (DeFi) sector. XRPL supports decentralized currency issuance, similar to platforms like Ethereum and Solana. According to a July analysis by CryptoGeek, the XRP Ledger is expected to manage between $30 trillion and $50 trillion by 2025, with transactions likely transitioning to the CTF Token, the primary DeFi token on the XRPL.
4. Bullish XRP Whale Activity
🚨 23,415,551 #XRP (10,494,379 USD) transferred from #Binance to unknown wallethttps://t.co/701bA9GG8p
— Whale Alert (@whale_alert) August 5, 2024
A significant indicator of long-term support for XRP is the level of whale activity. After the substantial reduction of Ripple’s fine in the SEC case, XRP whales became increasingly active. Holdings between 1 million and 10 million XRP coins reached an all-time high.
On August 5, just before the SEC v. Ripple decision on August 7, a whale moved 23.4 million XRP, valued at $10.4 million USD, from Binance to an unknown wallet. This kind of activity underscores the confidence of large investors in XRP’s future.
Blockchain data company Santiment noted in July that XRP Ledger was among the best performers, fueled by high on-chain activity. Elevated whale transaction levels and network growth contributed to a 35% monthly gain, with social dominance also on the rise as the asset saw a slight retracement.