Ripple’s Legal Battle and the SEC Appeal Scenario

While the SEC and Ripple progress toward a conclusion of the case, uncertainty about SEC motives lingers.

On Friday, Ripple CEO Brad Garlinghouse highlighted three consecutive wins for Ripple. These included the Programmatic Sales ruling, the court decision against the SEC interlocutory appeal, and the dropped charges against Ripple co-founder Chris Larsen and CEO Brad Garlinghouse.

The Programmatic Sales ruling remains the most significant for Ripple and likely for the SEC. As background, the court ruled that XRP does not qualify as a security when sold on digital asset exchanges programmatically. The judge noted that Programmatic Sales were blind/bid ask transactions, and Programmatic Buyers could not have known if their payments went to Ripple or any other seller of XRP.

After failing to contest the ruling with an interlocutory appeal, the final option is to appeal the ruling upon the conclusion of the SEC v Ripple case. Speculation about the likely Ripple penalty for XRP sales to institutional customers has drawn interest. However, the prospect of an appeal of the Programmatic Sales ruling could leave investors to grapple with uncertainty.

Programmatic Sales of XRP: An SEC Appeal

Notably, the 90 days for remedial-related discoveries will extend the SEC v Ripple case into Q1 of 2024. The legal fraternity estimates an appeal to take one year, which would take the case into 2025.

Ripple CEO Brad Garlinghouse recently gave an optimistic spin on an SEC appeal, saying,

“The current Supreme Court, we’d love to see the Vegas odds on how that would go. They have not been friendly to regulators.”

Notably, a Ripple win at the Supreme Court level would amplify the original Programmatic Sales ruling. The SEC has to weigh the pros and cons of an appeal and the ramifications of the court upholding the Programmatic Sales ruling. An SEC decision to accept the original ruling would be a boon for XRP and the crypto market.

XRP Price Action

Daily Chart

XRP held above the 50-day and 200-day EMAs, affirming bullish price signals.

An XRP return to $0.68 would give the bulls a run at the $0.7047 resistance level.

SEC v Ripple case-related comments and court activity will remain the focal points.

An XRP fall through the $0.65 handle would give the bears a run at the $0.6354 support level.

The 14-day RSI reading of 66.72 indicates an XRP return to $0.68 before entering overbought territory.

4-Hourly Chart

In the 4-hourly Chart, XRP hovers above the 50-day and 200-day EMAs, reaffirming bullish price signals.

An XRP move through $0.68 would bring the $0.7047 resistance level into play.

However, a fall through the 50-day EMA would support a fall to the $0.6354 support level.

The 4-hourly RSI, with a reading of 48.95, indicates an XRP fall to the $0.6354 resistance level before entering oversold territory.