XRP News Today: Legal Battle and ETF Speculation Fuel Market Volatility; BTC Hovers at $96K

XRP: Security or Not a Security?

On Monday, February 17, XRP faced scrutiny as investors awaited updates on the SEC’s appeal strategy in the Ripple case. Podcaster Jason Calacanis revived a debate on XRP’s classification, labeling it a centrally controlled security. He questioned whether the SEC should allow XRP to trade like bitcoin (BTC), stating;

“If the SEC allows it to trade like Bitcoin, then securities law will be worthless. There will be chaos in the markets as a million startups, funds, and grifters start dumping 50% of their coins on retail while slowly selling the 50% they own and control. That kind of chaos is NOT a good idea for America because the world believes we have stable and controlled markets — and they’re willing to park and invest their money with us.”

Calacanis proposed that the SEC restrict XRP trading to accredited investors, arguing that they are better positioned to understand the risks.

Amicus Curiae attorney John E. Deaton reacted to Calacanis’ post:

“As someone who publicly disclosed (while running for U.S. Senate) owning 80% of his net worth in Bitcoin and, as someone who fought the SEC over this very issue and won (with a lifelong democratic judge, appointed by Barack Obama, citing to my efforts and legal work), I’d be happy to educate Jason on the law, if he desires. But he may prefer to issue statements like this one, unchallenged, in order to further promote potential bias.”

XRP-Spot ETF Approvals Hinge on Status as a Non-Security Asset

Last week, the SEC acknowledged the 19b-4 applications from ETF issuers Grayscale and 21Shares. The acknowledgments further reinforced XRP’s classification as a security.

Under Rule 19b-4, the SEC’s approach to crypto-spot ETF approvals depends on whether it considers the underlying asset a security or a non-security commodity.

If the SEC deems XRP a security, it would not process 19b-4 applications for XRP-spot ETFs. However, for non-security commodities, including gold, oil, BTC, and ETH the SEC considers commodities, the agency follows the 19b-4 process for listing rule changes.

If classified as a security, ETF issuers must file N-1A forms under the Investment Company Act of 1940. ETF issuers typically file N-1A forms for equity and bond ETFs. Additionally, any shift in the SEC’s stance—reclassifying an asset from a commodity to a security—could introduce regulatory complications.

The SEC acknowledged the applications despite filing an appeal-related opening brief, challenging the Programmatic Sales of XRP ruling. In 2023, Judge Analisa Torres ruled that programmatic sales of XRP did not satisfy the third prong of the Howey Test. Last week’s 19b-4 acknowledgments intensified speculation about the SEC withdrawing its appeal.

XRP Price Trends: Appeal Strategy in Focus

On Monday, February 17, XRP fell 2.52% after Sunday’s 1.20% loss, closing at $2.6609. XRP underperformed the broader crypto market, which slipped by 0.26% to a total market cap of $3.13 trillion. The SEC’s silence on the Ripple case remained an XRP headwind as the agency’s Crypto Task Force focused on other crypto-related cases.

Ripple case-related updates and progress toward a US XRP-spot ETF market remain crucial drivers. Key Price Scenarios:

• Bullish Case: An SEC appeal withdrawal could drive XRP past its all-time high of $3.55.
• ETF Catalyst: Approval of an XRP-spot ETF could push XRP toward $5 due to institutional inflows.
• Bearish Case: If the SEC proceeds with its appeal and rejects XRP-spot ETFs, XRP could drop below $1.50.

Click here to find out why analysts believe XRP could skyrocket—or crash—based on the SEC’s decision.

Bitcoin Awaits Fresh Catalysts Amid Strategic Bitcoin Reserve Uncertainty

Beyond the Ripple case, bitcoin (BTC) remained in a sideways trend. The slow progress toward establishing a US Strategic Bitcoin Reserve (SBR) weighed on demand.

While multiple US states are exploring BTC as a strategic reserve asset, the Bitcoin Act has seen little progress in Congress. Senator Cynthia Lummis introduced the bill in late 2024, proposing the US government purchase one million BTC over five years, with a 20-year mandatory holding period.

Since introducing the bill, President Trump signed an executive order (EO), creating the Presidential Working Group on Digital Asset Markets. One of its key tasks is evaluating the creation of a national digital asset stockpile. However, the EO did not name BTC directly, fueling speculation about Trump’s broader crypto policy.

Pro-crypto lawyer Bill Morgan criticized Senator Lummis’ BTC-centric approach on February 16, stating:

“Yes I warned about Senator Lummis a long time ago. She will push for Bitcoin to have a special position and a permanent advantage over Altcoins. I don’t think President Trump and Elon Musk are for Bitcoin exceptionalism as this would ultimately harm innovation which Trump wants the USA to lead.”

A national SBR could tilt the supply-demand balance. John E. Deaton recently commented:

“If the US Government (USG) passes Senator Lummis’ Bill and begins buying BTC, it will no doubt cause other nations to follow suit, just like with gold. It could literally create Nation State FOMO, and if that occurs, $1M per BTC happens a lot faster than people think.”

Bitcoin Price Outlook

On February 17, BTC slipped by 0.48% after falling 1.51% on Sunday to close at $95,768. BTC fell short of the $100k level for the tenth consecutive session, reflecting uncertainty about a national SBR.

Looking ahead, key BTC catalysts include:

• US Economic Data: Jobless claims report (February 20) and Services PMI (February 21).
• FOMC Commentary: insights into inflation, the labor market, and the Fed’s rate path.
• US Tariff policies: Trade tensions and economic impact.
• Strategic Bitcoin Reserve (SBR) Development: Updates on the US government’s stance on BTC reserves.

Possible BTC Price Scenarios:

• Bearish: Increased US tariffs, strong economic data, a hawkish Fed, and resistance to a U.S. SBR could drag BTC toward $90,000.
• Bullish: Weaker US economic data, a dovish Fed, easing trade tensions, and progress on an SBR could push BTC toward its all-time high of $109,312.

Market Outlook: Regulatory Developments Remain Key

Investors should monitor the following factors, which will influence institutional engagement and price trends:

1. Updates on the SEC’s appeal in the Ripple case.
2. US tariff policies and their impact on inflation.
3. US economic data and Fed commentary.
4. Developments surrounding the Strategic Bitcoin Reserve (SBR).
5. BTC-spot ETF market flows and institutional adoption.

Will the SEC finally withdraw its appeal? Keep an eye out for our updates and the latest insights here.