XRP, the digital asset linked to Ripple Labs, has seen a remarkable price surge lately. Over the past month, its value has nearly quadrupled. On Saturday, XRP reached $1.93, a price it hadn’t seen since January 2018. Back then, it was just after setting its all-time high of $3.40. This recent surge means XRP has grown by almost 30% in the last week and has a 30-day gain of 274%.
Many believe this spike is due to the possibility of a crypto-friendly administration under Donald Trump. Since Trump won the U.S. presidential election this month, the entire crypto market has felt a positive impact. But XRP, in particular, is experiencing larger gains. One key factor is the expected resignation of Gary Gensler, the current Chair of the Securities and Exchange Commission (SEC), effective January 20, 2025. His departure could pave the way for a more crypto-supportive SEC Chair.
Under Gensler, the SEC has been tough on crypto firms in the United States. Ripple Labs, the company behind XRP, has been in a long legal battle with the SEC. The SEC claims that Ripple’s founders conducted an unregistered securities offering by selling XRP. Ripple, on the other hand, argues that XRP is a currency, not a security. This legal tussle has created regulatory uncertainty around XRP.
With Gensler stepping down, there’s speculation about who will replace him. Paul Atkins, a former SEC Commissioner, is the frontrunner with a 68% chance of becoming the next SEC Chair, according to betting platform Kalshi. Brad Bondi is another candidate, though with a lower probability of 20%. Both Atkins and Bondi are seen as pro-crypto and might change the SEC’s stance on crypto enforcement. John Reed Stark, former Chief of the SEC’s Office of Internet Enforcement, believes that Atkins would likely reverse the SEC’s aggressive approach towards crypto. Stark thinks Atkins favors free markets and dislikes over-regulation, which could be positive for the crypto world.
If a pro-crypto SEC Chair takes over, it could benefit Ripple Labs in their ongoing legal case. There’s hope that the new leadership might end the SEC’s appeal against rulings in the Ripple case. In July 2023, Judge Analisa Torres ruled that programmatic sales of XRP did not meet the criteria of the Howey Test, which determines whether a transaction qualifies as an investment contract. If this ruling stands and the SEC withdraws its appeal, it could set an important legal precedent.
Such a development could also fast-track the approval of XRP-spot Exchange-Traded Funds (ETFs). Major financial players like WisdomTree, Bitwise Invest, Canary Funds, Grayscale, and WisdomTree have filed for ETFs that include or exclusively invest in XRP. An XRP-spot ETF would allow investors to invest in XRP without actually buying the cryptocurrency themselves. This could increase demand for XRP and drive up its price.
Looking at Bitcoin’s success with spot ETFs, there’s reason to be optimistic. Bitcoin’s price has soared 127% since January 2024, reaching $96,324 after BTC-spot ETFs launched. If XRP-spot ETFs follow a similar path, XRP could see significant gains.
On Saturday, November 23, XRP rallied by 8.29%, following a 16.91% surge on Friday, ending the day at $1.9515. This marks the first time XRP closed at the $1.95 level since April 2021. The overall cryptocurrency market cap increased slightly by 0.23% to $3.330 trillion. XRP’s performance outpaced the broader crypto market, highlighting the strong interest in this digital asset.
Technical analysis shows that XRP is in a bullish trend. It sits comfortably above both the 50-day and 200-day Exponential Moving Averages (EMAs). If XRP breaks above Saturday’s high of $1.9591, it could move toward the $2 mark. A breakout from $2 might enable it to target its all-time high of $3.5505 from January 2018.
However, there are risks to consider. If XRP falls below $1.85, it might signal a drop toward $1.75 or even lower to $1.50. Negative news, such as the SEC continuing its appeal against Ripple Labs, could trigger a sell-off. The Relative Strength Index (RSI) is at 85.41, which is deep within overbought territory. This means there might be increased selling pressure at current price levels.
The crypto community is keeping a close eye on SEC Chair-related updates and news about the Ripple case. The potential for a pro-crypto SEC Chair brings optimism. If the SEC takes a more lenient approach, it could boost XRP demand and support higher prices.
Ripple Labs uses XRP for money-transmitting services. The company has been developing solutions to make cross-border payments faster and cheaper. This real-world use case adds value to XRP and differentiates it from many other cryptocurrencies.
The overall crypto market has been growing, with new developments and increased institutional interest. Companies like WisdomTree and Bitwise are making plans for ETFs that include cryptocurrencies like XRP. ETFs can make it easier for traditional investors to enter the crypto market, potentially bringing in more capital.
It’s important to understand the role of the Howey Test in the Ripple case. The Howey Test is used to determine whether a transaction is an investment contract subject to securities laws. Judge Torres’s ruling that programmatic sales of XRP do not satisfy the Howey Test’s third prong is significant. It suggests that these sales might not be considered securities offerings.
If the SEC’s appeal is withdrawn or dismissed, it could remove the regulatory uncertainty surrounding XRP. This would be positive for both Ripple Labs and XRP holders. It might also encourage other crypto projects facing similar legal challenges.
Bitcoin has been leading the charge across the crypto industry since Donald Trump’s election victory. However, XRP’s recent gains have outpaced Bitcoin’s. While Bitcoin has benefited from broader market optimism, XRP’s surge is more directly linked to developments in the Ripple case and SEC leadership changes.
The crypto-friendly policies expected under a Trump administration could reshape the landscape. With pro-crypto candidates like Paul Atkins potentially taking the helm at the SEC, there could be a shift in how crypto regulations are enforced. This might lead to a more favorable environment for cryptocurrencies like XRP.
Investors who bought XRP at its low of $0.127 in March 2020 would have seen a 1,420% gain at its recent high. This highlights the volatility and potential for high returns in the crypto market. However, it’s important to approach such investments with caution, considering the risks involved.
XRP’s recent rally is fueled by a mix of Ripple case optimism and ETF speculation. The interplay between regulatory developments and market sentiment plays a crucial role in its price movements. Enthusiasts are watching closely to see how these factors unfold.
XRP is experiencing a significant price surge, reaching levels not seen in years. The potential for a pro-crypto SEC Chair and the resolution of the Ripple case are key factors driving this momentum. ETF speculation adds another layer of interest, as ETFs could open the door for more investors to participate in the XRP market. While there are risks, the outlook for XRP appears optimistic, especially if regulatory hurdles are cleared.
