XRP News Today: Geopolitical Strain, SEC Ripple Case Drive XRP Trends

The Friday Overview

XRP advanced by 0.12% on Friday. Following a 1.43% gain on Thursday, XRP closed the session at $0.5030.

Geopolitical Tensions Intensify in the Middle East

On Friday, news of Israel retaliating against the Iran attack on April 13 impacted XRP and the broader market. XRP slid to a Friday session low of $0.4671.

However, Iran downplayed the missile attack, calming market risk sentiment. Nevertheless, XRP saw modest gains, with intensifying geopolitical tensions likely influencing near-term trends for riskier assets.

While news from the Middle East grabbed the headlines, the SEC v Ripple case remained the focal point. The case is in its final stages, with three filings remaining before Judge Analisa Torres rules on the penalty Ripple must pay for breaching US securities laws.

SEC vs. Ripple: The Opposition Brief

According to the amended court briefing schedule, Ripple must file its opposition brief by Monday, April 22, and a redacted version by April 24.

The opposition brief will address SEC allegations from the opening brief. Successfully addressing the individual claims could significantly reduce the penalty that Ripple must pay. In June 2013, the court ruled Ripple failed to register XRP as a security in sales to institutional investors.

In the opening brief, the SEC claimed that Ripple continued breaching US securities laws after the 2020 complaint. Before the SEC filed the opening brief, Judge Sarah Netburn addressed the issue of post-complaint conduct in a previous ruling, surmising,

“Courts have no hesitation in concluding that, in calculating the size of a penalty necessary to deter misconduct, the extent of a defendant’s wealth is a relevant consideration.”

Opposition Brief: No harm to US Institutional Investors, No Foul

If Ripple can demonstrate it made all post-complaint XRP sales to US institutional investors, the court will likely focus on pre-complaint conduct. Proceeds from pre-complaint XRP sales to institutional investors totaled approximately $729 million.

According to US case law, the SEC only has jurisdiction over sales to US institutional investors (US Supreme Court: Morrison vs. NAB).

Ripple can argue to deduct the proceeds from XRP sales to non-US institutional investors from the $729 million. On Thursday, Ripple CEO Brad Garlinghouse said the US accounts for only 5% of its global business. If the proceeds from XRP sales to US institutional investors only account for 5% of the $729 million, the starting point for penalties could be $36.45 million.

Ripple can deduct expenses from XRP sales to US institutional investors.

And finally, the US appellate courts upheld the SEC vs. Govil ruling in April 2024. In SEC vs. Govil, the court ruled the SEC is not entitled to disgorgement from the seller if a buyer suffers no financial loss.

Ripple could pay a significantly lower penalty than its $150 million legal bill if it can navigate the opening brief with US case law. Such a scenario would be another blow for the SEC.

XRP Price Action

Daily Chart

XRP hovered well below the 50-day and 200-day EMAs, affirming the bearish price signals. The 50-day EMA remained converged on the 200-day EMA. A bearish cross of the 50-day EMA through the 200-day EMA would be a sell signal.

An XRP move through the bottom and the top trend lines would give the bulls a run at the $0.5739 resistance level and the 200-day and 50-day EMAs. Selling pressure may intensify at the $0.5739 resistance level. The 200-day and 50-day EMAs are confluent with the resistance level.

Geopolitical tensions and SEC vs. crypto case-related news warrant investor attention.

Conversely, a fall through the $0.48 handle would bring the $0.45 level into play.

The 14-day RSI reading, 36.09, suggests an XRP break below the $0.48 handle before entering oversold territory.

4-Hourly Chart

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

An XRP breakout from 50-day EMA and the bottom trend line could give the bulls a run at the top trend line. A break above the top trend line would bring the $0.5361 resistance level into play.

However, an XRP break below the $0.48 handle could signal a drop to the $0.45 handle.

The 4-hourly RSI, with a reading of 52.14, indicates an XRP break above the $0.5361 resistance level before entering overbought territory.