XRP’s price has skyrocketed to over $1 this week, nearly doubling in value. This surge comes amidst the U.S. Securities and Exchange Commission’s (SEC) legal challenges and positive regulatory changes in the cryptocurrency market. The recent price increase is also in line with the optimistic sentiment in the options market.
The surge in XRP’s price saw it reach a three-year high, surpassing $1.27 at one point, according to CoinDesk data. This significant price increase has boosted XRP’s market capitalization to $63.59 billion. The surge in XRP’s price can be attributed to the mounting legal challenges faced by the SEC. A group of state attorneys general and the DeFi Education Fund recently filed a lawsuit against the SEC, alleging regulatory overreach in the enforcement actions against digital asset exchanges. The lawsuit argues that cryptocurrencies should not be classified as investment contracts, like stocks and bonds, but rather as assets. This lawsuit could have a significant impact on the outcome of the SEC’s pending appeal in the Ripple case.
In December 2020, the SEC filed a lawsuit against Ripple Labs, accusing the company of conducting an unregistered securities offering through the sale of XRP. While a U.S. court ruled that Ripple’s sales to institutional investors qualified as securities transactions, it also determined that sales of XRP on public exchanges did not fall under the definition of a security. The SEC appealed this ruling in October, seeking further clarity on the legal status of XRP.
LondonCryptoClub’s founders believe that XRP’s recent surge is driven by expectations of more favorable regulation under the upcoming Trump administration. They anticipate a friendlier regulatory environment under Trump, particularly with the potential departure of SEC chief Gary Gensler, who has been embroiled in legal battles with Ripple Labs. The founders also speculate about a potential meeting between Ripple’s CEO and Trump, hinting at a more favorable regulatory environment for companies and tokens like Ripple.
The surge in XRP’s price above $1 aligns with the bullish sentiment in the options market earlier this week. Additionally, there has been a significant increase in futures open interest, reaching a record high of $1.53 billion, according to Coinalyze data. This uptick in open interest, coupled with the price rally, confirms the upward trend in XRP’s price.
Overall, XRP’s price surge to over $1 reflects the ongoing legal challenges faced by the SEC and the expectations for positive regulatory changes in the cryptocurrency market. Investors and stakeholders are closely monitoring these developments, as they could have a profound impact on the future of XRP and the broader cryptocurrency industry.