XRP News: SEC v Coinbase Court Hearing to Influence SEC Appeal Plans

Key Insights:

• XRP declined by 0.12% on Monday, ending the session at $0.5754.
• Investor sentiment toward the SEC cases against Coinbase and Ripple left XRP at sub-$0.60.
• On Tuesday, the focus will remain on SEC v Coinbase and sentiment toward SEC plans to appeal the Programmatic Sales ruling.

The Monday Overview

On Monday, XRP declined by 0.12%. Partially reversing a 0.28% gain from Sunday, XRP ended the session at $0.5754.

SEC v Ripple: Remedies-Related Discovery

There was no SEC v Ripple case-related news to influence XRP price trends on Monday. The SEC and Ripple are progressing through remedies-related discovery. Remedies-related discovery is the final stage in deciding the penalty for XRP sales to US institutional investors.

Ripple must provide the SEC with 2022-2023 financial statements and post-complaint contracts governing institutional sales by January 19. The SEC filed a Motion to Compel on January 11. The Motion to Compel asked the court to order Ripple to submit the requested documents.

The SEC and Ripple must complete remedies-related discovery by February 12. Ripple will attempt to reduce the possible penalty by showing net proceeds from XRP sales to US institutional investors. In contrast, the SEC will want a punitive disgorgement after the Programmatic Sales of XRP ruling. Judge Analisa Torres ruled that XRP is not a security in Programmatic Sales.

However, US case law could favor Ripple. In Morrison v NAB, the US Supreme Court ruled the SEC only has jurisdiction over US-based sales. Proceeds of XRP to institutional investors totaled $770 million. Ripple will deduct XRP sales to non-US institutional investors.

Additionally, in the case Liu v SEC, the court ruled the penalty cannot exceed the net profits. Ripple will deduct expenses related to XRP sales to US institutional investors from the proceeds from XRP sales to US institutional investors.

The court decision on the penalty will grab the headlines. However, SEC plans to appeal against the Programmatic Sales ruling remain the focal point. The SEC v Coinbase (COIN) case could influence SEC plans to appeal against the ruling.

SEC v Coinbase: Motion to Dismiss Hearing in Focus

Coinbase filed a motion to dismiss (MTD) in August, arguing the SEC lacks the statutory authority to regulate crypto exchanges.

On Wednesday, January 17, Judge Katherine Failla will hear oral arguments on the Coinbase motion. Coinbase filed an MTD, arguing the SEC lacks the statutory authority to regulate crypto exchanges.

A ruling for Coinbase would be a boon for the crypto market. However, the Terraform Labs ruling that TerraUSD and Luna are securities reduces the chances of Judge Katherine Failla granting the Coinbase MTD.

In January, the SEC requested the court consider the Terraform Labs ruling in the case against Coinbase.

If Judge Failla dismisses the MTD, the SEC v Coinbase case will deliver more uncertainty to the US digital asset space. A lack of a regulatory framework could allow the SEC to continue regulating by enforcement.

XRP Price Action

Daily Chart

XRP remained below the 50-day EMA while holding above the 200-day EMA, sending bearish near-term but bullish longer-term price signals.

An XRP break above the $0.5835 resistance level would support a move to the 50-day EMA. A breakout from the 50-day EMA would give the bulls a run at the $0.6354 resistance level.

On Tuesday, the focus will remain on SEC v crypto case-related updates and SEC activity.

However, a fall through the 200-day EMA would bring the $0.5470 support level into play.

The 14-day RSI reading, 43.07, indicates an XRP fall through the $0.5470 support level before entering oversold territory.

4-Hourly Chart

On the 4-hourly, XRP sat below the 50-day and 200-day EMAs, sending bearish price signals.

An XRP break above the 50-day EMA and the $0.5835 resistance level would support a move to the 200-day EMA.

However, a drop below the $0.57 handle would give the bears a run at the $0.5470 support level.

The 4-hourly RSI, with a reading of 46.44, suggests an XRP fall to the $0.5470 support level before entering oversold territory.