XRP News: SEC’s Ripple Battle Intertwined with SEC v Coinbase Case Outcome

The Tuesday Overview

On Tuesday, XRP tumbled 8.60%. Reversing a 3.23% gain from Monday, XRP ended the session at $0.5920. The Tuesday loss was the most marked since it fell by 13.87% in August 2023.

XRP tracked bitcoin (BTC) and the broader crypto market into negative territory on Tuesday. BTC slid by 6.40%, with the total crypto market cap falling 5.14% ($125.565 billion) to $2,316 billion.

Investors locked in profits after BTC briefly revisited the $69,000 handle for the first time since November 2021. XRP tracked BTC and the broader crypto market throughout the Tuesday session.

Despite the lack of updates from the ongoing SEC v Ripple case, the SEC was in focus.

Ripple Chief Legal Officer Highlights SEC Bad Faith Practices

On Tuesday, Ripple Chief Legal Officer Stuart Alderoty shared a filing from the SEC v Binance case, saying,

“Yesterday, SEC told a judge that she should consider a decision from another court without disclosing that the decision was a “default judgment”, meaning no one showed up to defend itself, and thus, the relevant legal issue was never actually litigated. That’s bad faith.”

Alderoty explained further, adding,

“Relying on a default judgment is like me challenging Conor McGregor to a fight and when he doesn’t show up, I shadow box for a few rounds and then declare myself the champion.”

The SEC move came shortly after the SEC v Debt Box debacle, leading to the SEC dropping all charges. In the SEC v Debt Box case, the court ordered, “the SEC to show cause why it should not be sanctioned for making false and misleading representations to the court.”

The SEC responded by filing a Motion to Dismiss rather than face further scrutiny.

Significantly, the Motion to Dismiss did not go unnoticed on Capitol Hill. In February, US Senators co-signed a letter to SEC Chair Gary Gensler, threatening the SEC with more scrutiny.

Bad faith practices could also come to light in the SEC v Ripple case. Last month, US Government Watch Dog Empower Oversight announced the Office of Inspector General (OIG) was nearing an end to investigations into crypto conflicts of interest within the SEC.

The conflicts of interest relate to former SEC Director William Hinman.

SEC: Conflicts of Interest and Coinbase Battle

Hinman guided the SEC crypto regulation framework while allegedly receiving millions of dollars from former employer Simpson Thacher. Simpson Thacher forms part of a group promoting Enterprise Ethereum. The Hinman-related documents, disclosed during the SEC v Ripple case, highlighted that Hinman continued meeting with Simpson Thacher despite warnings from the SEC ethics department.

Findings of conflicts of interest could end SEC plans to appeal against the Programmatic Sales of XRP ruling. In July 2023, Judge Analisa Torres ruled programmatic sales of XRP did not satisfy the third prong of the Howey Test.

As investors await the outcome of the investigation, a ruling from the SEC v Coinbase (COIN) case could be more pivotal. Coinbase filed a Motion to Dismiss (MTD) in August 2023, arguing the SEC lacked the statutory authority to regulate exchanges.

Judge Katherine Failla heard oral arguments in January 2023. If Judge Failla grants the MTD, the courts could force the SEC to end its regimen of regulation through enforcement.

Amicus Curiae attorney, CryptoLaw US founder, and candidate for US Senate (Massachusetts) believes the SEC would settle the case against Ripple if the court grants the Coinbase MTD. A settlement would end SEC plans to appeal the Programmatic Sales ruling, a boon for XRP and the broader crypto market.

A court ruling on the MTD could arrive at any time.

XRP Price Action

Daily Chart

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

An XRP return to the $0.62 handle would support a move to the $0.6354 resistance level. A break above the $0.6354 resistance level would bring the Tuesday high of $0.6692 into play.

SEC v crypto case-related updates, the OIG Investigation, and BTC-spot ETF market flows need consideration.

However, a break below the $0.5835 support level would give the bears a run at the 50-day EMA.

The 14-day RSI reading, 54.46, suggests an XRP break above the Tuesday high of $0.6692 before entering overbought territory.

4-Hourly Chart

On the 4-hourly, XRP hovered below the 50-day EMA while remaining above the 200-day EMA, sending bearish near-term but bullish longer-term price signals.

An XRP break above the 50-day EMA would give the bulls a run at the $0.6354 resistance level.

On the other hand, a break below the $0.5835 support level would bring the 200-day EMA ($0.5691) into play.

The 4-hourly RSI, with a reading of 41.48, suggests an XRP fall through the 200-day EMA before entering oversold territory.