XRP News: SEC v Debt Box and SEC v Ripple Draw Similarities

Key Insights:

• XRP gained 0.95% on Friday, ending the session at $0.5105.
• XRP tracked the broader market into positive territory despite a pending ruling on the SEC Motion to Compel.
• On Saturday, US lawmaker chatter, SEC scrutiny, and SEC v Ripple case-related news need consideration.

The Friday Overview

On Friday, XRP gained 0.95%. Following a 0.60% rise on Thursday, XRP ended the Friday session at $0.5105.

SEC v Ripple: Judge Torres, the Motion to Compel, and SEC v Debt Box

There were no SEC v Ripple case-related updates to influence XRP price trends on Friday. Ripple, the SEC, and XRP holders await a court ruling on the SEC Motion to Compel.

The SEC filed the Motion to Compel on January 11, with a second filing on January 23. Ripple opposed the Motion to Compel on January 19 and filed a Sur-Reply motion on January 21.

The Sur-Reply letter argued the SEC made factual mischaracterizations in the Motion to Compel.

SEC Chair Gary Gensler made no comments regarding the Sur-Reply letter. The timing of the Sur-Reply letter was significant. In December, the SEC v Debt Box case took an unexpected turn. Judge Robert Shelby ordered the SEC to show cause why the court should not sanction SEC lawyers for making false and misleading representations to the court.

On January 27, the SEC filed a Motion to dismiss the charges against Debt Box.

Judge Torres will likely be aware of the SEC v Debt Box case. The SEC could face similar court scrutiny in the ongoing SEC v Ripple case if Judge Torres rejects the Motion to Compel.

The SEC Motion to Compel

As background, the SEC filed the Motion to Compel, asking the court to order Ripple to provide,

• Financial statements for 2022/23.
• Post-complaint contracts governing XRP sales to institutional investors.

The SEC and Ripple are progressing through remedies-related discovery. In July, Judge Torres ruled the SEC broke Section 5 of the Securities Act for failing to register XRP as a security for sales to institutional investors.

On Thursday, Amicus Curiae attorney John E Deaton discussed the SEC Motion to Compel, saying,

“It is quite possible that Ripple would be able to show an exemption to the vast majority of those institutional sales. […] It’s quite possible that the Judge could fine Ripple something like $10 million.”

Deaton explained that Ripple could demonstrate it sold a sizeable portion of XRP to accredited investors. Ripple could claim an exception regarding XRP sales to accredited investors.

XRP Price Action

Daily Chart

XRP sat below the 50-day and 200-day EMAs, affirming bearish price signals.

An XRP move to the $0.52 handle would bring the $0.5470 resistance level into play.

SEC v Ripple case-related news, SEC activity, and US lawmaker scrutiny warrant investor attention.

However, a fall through the $0.5042 support level could give the bears a run at the $0.4700 support level.

The 14-day RSI reading, 35.67, indicates an XRP drop below the $0.50 handle before entering oversold territory.

4-Hourly Chart

On the 4-hourly, XRP remained below the 50-day and 200-day EMA. The EMAs confirmed the bearish price trends.

A breakout from the 50-day EMA would support an XRP move to the $0.5470 resistance level.

However, a fall through the $0.5042 support level would bring the $0.4700 support level into play.

The 4-hourly RSI, with a reading of 46.55, indicates an XRP move to the $0.48 handle before entering the oversold territory.