XRP Rallies on Ripple Lawsuit Progress, But Can it Fly High Again?

The price of XRP skyrocketed by 26% on August 7th after a federal judge in New York moved closer to ending the long-standing lawsuit between Ripple Labs and the U.S. Securities and Exchange Commission (SEC). Ripple executives hailed the decision as a “victory” for the entire crypto industry.

The judge ordered Ripple to pay a $125 million civil penalty and barred them from further violations of securities laws. This seemingly paves the way for a final resolution to the lawsuit, which began in December 2020.

XRP Price Responds Positively, But Questions Remain

The XRP price surged to $0.63 on the news, recouping most of its losses from the recent market downturn. However, it has since retreated slightly and is currently trading around $0.59.

This positive price movement reflects optimism within the XRP community. Ripple CEO Brad Garlinghouse stated that the SEC’s “war on crypto” is finally over, while Ripple co-founder Chris Larsen expressed hope that the ruling would end the regulatory uncertainty surrounding XRP.

Short Sellers Liquidated, But Can the Rally Sustain?

The price surge caught short sellers by surprise, with $5.4 million in short positions liquidated within a few hours. However, the rally faces a potential test at $0.55, where another $25 million in long positions could be liquidated according to CoinGlass data.

Momentum will be crucial for XRP. If the price breaks above $0.65, another $20 million in short positions could be liquidated, potentially fueling further gains. However, a sustained rally requires broader market support.

ODL Sales Remain Uncertain Despite Judge’s Ruling

While the lawsuit nears an end, questions remain about the impact on Ripple’s On-Demand Liquidity (ODL) service, which utilizes XRP for instant cross-border settlements. Attorney Jeremy Hogan believes ODL sales outside the US won’t be affected, although Ripple needs to be careful about how it conducts sales within the US.

XRP Community Eyes Potential ETF and Price Surge

With the lawsuit nearing an end, some analysts are predicting an XRP ETF could be on the horizon. Additionally, crypto analyst Javon Marks sees bullish technical indicators and predicts a potential price breakout to $15-$18, with a more optimistic target of $100. However, reaching the all-time high of $3.4 or exceeding Bitcoin’s market cap seems unlikely.

ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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