The price of XRP is dropping following the news that the SEC is filing appeal. What exactly is happening, what is likely going to be next, how important and concerning is this appeal. Also, how is this appeal and the XRP price dropping affecting XRP forecasts?
SEC Appeal Filed: Today’s Breaking News
A few hours ago, the U.S. Securities and Exchange Commission (SEC) officially filed an appeal against Judge Analisa Torres’ ruling in the Ripple case:
SEC appeals decision that restricted its crypto oversight
This appeal comes after the July 2023 decision, which ruled that XRP sales on public exchanges did not constitute securities transactions, a significant win for Ripple.
However, the SEC’s appeal reignites the legal battle, throwing Ripple’s future regulatory environment back into uncertainty.
What Does the SEC Appeal Mean?
The SEC’s appeal specifically targets Judge Torres’ ruling that XRP’s public sales were not securities.
The SEC aims to challenge this interpretation because if upheld, it would limit the regulator’s ability to oversee certain cryptocurrency markets, including sales made on public exchanges like Coinbase. The SEC argues that the ruling could impede its ability to regulate a broader set of digital assets under securities laws, making the appeal critical not only for XRP but for other digital currencies.
However, it’s important to note that the appeal does not challenge all aspects of the case. Judge Torres also ruled that Ripple’s institutional sales of XRP, totaling over $728 million, should have complied with securities regulations. This part of the ruling remains intact, and Ripple faces potential penalties related to these institutional sales.
So, while the appeal could lead to further regulatory challenges for XRP on public exchanges, Ripple’s institutional sales are still under scrutiny, and the company remains liable for potential fines, though these are currently on hold pending the outcome of the appeal.
First reactions on the SEC appeal
Ripple CEO Brad Garlinghouse shared his thoughts on X, he wrote:
“While we’ll fight in court for as long as we need, let’s be clear: XRP’s status as a non-security is the law of the land today – and that does not change even in the face of this misguided – and infuriating – appeal. (Remember, when the SEC tried unsuccessfully to file an “interlocutory appeal” they made clear they had no intention of challenging XRP’s status as a non-security.)”
Chief Legal Officer at Ripple, Stuart Alderoty, also reacted on X:
“The SEC’s decision to appeal is disappointing, but not surprising. This just prolongs what’s already a complete embarrassment for the agency. […] Instead of faithfully applying the law, this agency, under this Chair, continues to engage in litigation warfare against the industry. We are evaluating whether to file a cross appeal.”
What’s Next for Ripple and XRP?
The appeal process will now head to the 2nd U.S. Circuit Court of Appeals in Manhattan. This could lead to an extended legal battle, delaying final clarity on XRP’s regulatory status. Depending on how the appellate court interprets Judge Torres’ ruling, the outcome could have broad implications for cryptocurrency regulation in the U.S.
It will take roughly 18 months until this appeal will result in a new ruling.
For Ripple, this means more legal uncertainty and the potential for tighter regulations on XRP’s public sales. A negative ruling from the appeals court could bring XRP back under the purview of U.S. securities laws, adding compliance burdens for exchanges and public sellers of the token.
This legal process will take time, likely dragging out for several months or even years, keeping XRP in a regulatory grey area for the foreseeable future.
The Big Picture: Ripple’s Global Utility and Adoption
While the appeal is significant, it’s essential to zoom out and look at the bigger picture. Ripple’s global utility and adoption are advancing rapidly, and the legal battles in the U.S. are only one part of the story.
READ – As SEC Appeal Countdown Nears, Ripple & XRP Global Adoption Far Outweigh Legal Drama
Ripple’s real strength lies in its expanding presence in global financial markets, where cross-border payments and tokenized assets are becoming critical areas of focus. In June 2024, Ripple expanded its cross-border payment capabilities in the UK and EU through a partnership with Clear Junction, enabling instant GBP and EUR payouts. Additionally, Ripple’s collaboration with Archax is set to bring hundreds of millions of dollars of tokenized real-world assets to the XRP Ledger (XRPL).
Moreover, just days ago, Ripple received in-principle approval from Dubai to offer end-to-end payment services in the UAE, positioning Ripple as a leader in the Middle East. These developments highlight Ripple’s growing utility in global finance, even as it faces ongoing legal challenges in the U.S.
Putting the Appeal in Perspective
The appeal, while important, is part of a broader narrative. Ripple’s court victory in August 2024 was a major milestone, and the SEC’s challenge, though significant, doesn’t erase the progress Ripple has made on the global stage.
Yes, the legal uncertainty will continue as the appeals process plays out, but Ripple’s focus on real-world adoption and expanding its payment network positions the company for long-term success. While XRP’s price may react to short-term legal developments, the utility Ripple brings to cross-border finance, asset tokenization, and payment solutions remains a strong foundation for future growth.
Is The Appeal Affecting InvestingHaven’s XRP Forecast
It’s unlikely that this appeal will significantly impact our latest XRP price prediction.
According to our XRP forecast 2024:
- XRP should exceed $0.66 before the end of 2024 to develop a secular breakout. XRP, after today’s price drop, still trades around $0.54, right at its 200 day moving average.
And our XRP forecast 2025:
- XRP’s bullish triangle chart structure is key: IF the long term bullish pattern confirms a W-reversal, then the chart pattern will dominate price action in 2025.
Conclusion: Two Major Trends to Watch
As we move forward, two major trends are unfolding concurrently: the ongoing legal uncertainty around XRP’s regulatory status and Ripple’s growing global adoption and utility. While the SEC appeal has added another layer of complexity to Ripple’s U.S. operations, the company continues to make strides internationally, with new partnerships and regulatory approvals paving the way for expanded use of XRP.
In the near term, we can expect price volatility as the legal process unfolds. However, the long-term potential for Ripple’s technology, especially as it scales its cross-border payment infrastructure, remains compelling. Ripple’s ability to maintain momentum in global markets may ultimately outweigh the impact of U.S. regulatory uncertainty.
