XRP News: US Lawmaker Scrutiny and SEC v Coinbase News in Focus

Key Insights:

• XRP declined by 0.29% on Thursday, ending the session at $0.5538.
• On Thursday, US lawmaker scrutiny dragged XRP and the broader market into negative territory.
• SEC v Coinbase and SEC v Ripple remain focal points before the weekend.

The Thursday Overview

XRP fell by 0.29% on Thursday. Following a 0.66% loss on Wednesday, XRP ended the day at $0.5538.

US Lawmaker Scrutiny Leaves XRP and the Crypto Market in the Red

On Thursday, Binance and Tether came under the scrutiny of US lawmakers. Senator Cynthia Lummis joined a chorus of lawmakers calling on the US government to act against Binance and Tether for being facilitators of funding Hamas.

Senator Lummis shared a letter to the US Department of Justice (DOJ), saying,

“When it comes to illicit finance, crypto is not the enemy – bad actors are. I sent a letter to the DOJ asking to finish its investigation and consider criminal charges against Binance and Tether after reports they served as intermediaries for Hamas and engaged in illicit activities.”

The letter from Senator Cynthia Lummis and Representative French Hill did not take a hard stand against crypto, stating,

“[…] We must be careful not to paint all crypto intermediaries as suspect when a small handful of bad actors use them for nefarious purposes.”

Senator Lummis and Representative Hill also urged the DOJ to take action against those who engage in illicit activities through cryptocurrencies. The letter referenced the WSJ Report on Hamas raising funds through crypto and subsequent reports highlighting the inaccuracy of the WSJ article.

The increased scrutiny coincides with a pivotal period for the US digital asset space. SEC cases against Binance, Coinbase (COIN), and Ripple remain ongoing. The SEC is also reviewing BTC-spot ETF applications, the approvals of which could open the floodgates for institutional investors to hold crypto.

There were no updates from the ongoing SEC v Ripple case to influence market sentiment. However, SEC v Coinbase case-related news drew investor interest.

SEC v Coinbase: The Case the SEC Can’t Afford to Lose

On Tuesday, Coinbase filed its reply brief to the SEC’s opposition to the Coinbase motion to dismiss (MTD). Coinbase Chief Legal Officer Paul Grewal provided a simple argument to sway a Court decision in Coinbase’s favor. Notably, Grewal said,

“By arguing that any purchase in which the buyer hopes for an increase in value constitutes an investment contract – and therefore a security- the SEC is attempting a radical expansion of its own authority. Only Congress can do that as the major questions doctrine makes clear.”

On Thursday, Grewal shared the latest SEC v Coinbase case-related updates, saying,

“Oral argument on our motion for judgment has been set: January 17. We appreciate the Court’s swift attention to this matter and look forward to answering the Court’s questions.”

According to the Court order,

“The Court is in receipt of Defendants’ request for oral argument concerning Defendants’ Motion for Judgment on the Pleadings. The request is GRANTED.”

The SEC and Coinbase must submit a joint filing by November 17, 2023, detailing the proposed schedule for the hearing. Amici Curiae can also speak at the hearing. In August, Senator Cynthia Lummis filed an Amicus Curiae brief supporting the Coinbase MTD.

Notably, the Court date for oral argument will ease pressure on the SEC in ongoing discussions with Ripple. There is speculation that the SEC wants to settle the case against Ripple before a ruling on the Coinbase MTD.

Amicus Curiae attorney John E. Deaton thinks the SEC will settle the case against Ripple if the Court grants the Coinbase MTD.

XRP Price Action

Daily Chart

XRP held above the 50-day and 200-day EMAs, affirming bullish price signals. On Thursday, the 50-day EMA crossed through the 200-day EMA, signaling a near-term bearish trend reversal.

A break above the trend line would give the bulls a run at the $0.5835 resistance level. Favorable SEC v Ripple case-related updates and crypto-spot ETF news would support a breakout session.

However, an XRP drop below the $0.5470 support level would bring the EMAs into view.

The 64.13 14-day RSI reading indicates a break above the trend line before entering overbought territory.

4-Hourly Chart

In the 4-hourly Chart, XRP remains above the 50-day and 200-day EMAs, reaffirming bullish price signals.

An XRP move through the trend line would give the bulls a run at the $0.5835 resistance level.

However, a break below the $0.5470 support level would support a move to the 50-day EMA.

The 4-hourly RSI, with a reading of 55.22, indicates an XRP break above the trend line before entering overbought territory.