Ripple Win Against SEC, Its Effects and Aftermath

Ripple Labs has finally won the historic battle against SEC. New York Southern District Judge Analisa Torres has confirmed that Ripple is not a security when it comes to retail sales in her judgement.

In her judgement Judge Torres clearly said that XRP did not satisfy the Howey Test for common buyers but may have satisfied the conditions of the Howey Test for the institutional part. The SEC’s motions were denied where it accused Larsen and Garlinghouse but were approved regarding their offer to sell XRP to institutional buyers.

The Case

SEC registered a case against Ripple in December 2020 after which Ripple Labs pursued a legal battle against SEC to prove that XRP is not a security.

Ripple Labs and its two executives, co-founder Christian Larsen and CEO Brad Garlinghouse were charged with committing financial crimes of selling unregistered security to the tune of $1.3 Billion.

You can find the original SEC press release here.

Judgement Details, Partial Wins for SEC and XRP Both

Judgement finds that Ripple was not in contravention of the SEC Rules and Laws when it made the public sales of its XRP coin.

However, when the institutional sales were made, it was clear(page 21) that the XRP was offered as a security. The SEC scored a partial win here. It alleged that Ripple Labs sold more than $728.9 Million worth of XRPs through institutional sales.

Here is the verbatim of the judgement paragraph.

These statements, and many more, are representative of Ripple’s overall messaging to the
Institutional Buyers about the investment potential of XRP and its relationship to Defendants’
efforts. Clearly, the Institutional Buyers would have understood that Ripple was pitching a
speculative value proposition for XRP with potential profits to be derived from Ripple’s
entrepreneurial and managerial efforts.

Judge, New York Southern District Court

Larsen(co-founder) sold $450 Million worth of XRP and Garlinghouse sold more than $150 Million worth of XRP from their personal holdings. The court noticed that they should have filed EDGAR filings with the SEC after these sales.

Ripple Soars More Than 87%, Becomes 4th Largest Crypto

Within 2-3 Hours after partially winning the case against SEC, Ripple(XRP) rapidly moved towards $1. After making a high of $0.89 as per CoinMarketCap, the price consolidated and settles near $0.8.

This historic rise of more than 87% in a single day and within a few hours made XRP increase its market cap to $41.4 billion now (press time). XRP has also become the fourth largest cryptocurrency by market cap after Bitcoin($605.66 Billion), Ethereum ($239.24 Billion), and Tether ($83.46 Billion). It is slightly above BNB ($39.74 Billion).

Coinbase Relists XRP

Ripple Relisted on Coinbase
Ripple Relisted on Coinbase

Within a few hours of win, XRP was relisted by Coinbase, one of the largest crypto exchanges in the world. It earlier delisted XRP because of SEC’s charges against the issuer of XRP, i.e., Ripple Labs on January 19, 2021.

Will Ripple Cross $1?

The $1 is a psychological barrier for all cryptocurrencies especially those which started below it.

Let us look at some technical and on-chain data.

Technical Analysis

We can observe from the technical charts that RSI is in overbought region (above 70) and MACD is at its peak. Both of them indicate high bullish sentiments. However since RSI has started its downward journey, its best to wait for a few days till the situation normalizes and the price becomes stable.

For a full analysis visit: Will Ripple(XRP) Cross $1? Surprising Reasons To HODL XRP Now

Dhirendra Chandra Das
Dhirendra Chandra Das

Dhirendra is a professional with dual degree MBA specializations in Finance and Marketing. He has a keen interest in finance and crypto. Starting his investment journey in Finance since 2015, Dhirendra has more than 8 years experience in Traditional Finance and 3 years experience in Decentralized Finance.

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