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Ripple pitches new role for XRP holders as SEC refuses clarity for secondary market

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  • Ripple’s lawyers are pitching John E. Deaton and XRP holders a new way to be involved in the lawsuit against the SEC if the intervention is rejected.
  • The SEC’s response letter regarding the pre-motion to intervene fails to indicate that it intends to provide clarity for the secondary XRP market.

After attorney John E. Deaton launched a renewed attempt to intervene on behalf of over 10,000 XRP holders last week, the U.S. Securities and Exchange Commission (SEC) and Ripple responded yesterday. As Deaton stated via Twitter, he had not spoken to Ripple or its lawyers about it.

However, Ripple‘s lawyers “sent a message in their response” to Deaton and all XRP holders, suggesting “that maybe there is a role for us even if it’s not intervention”. Ripple’s lawyers argue that their position depends on the SEC’s response.

To the extent the SEC seeks only to determine that “that the manner in which Defendants marketed and sold XRP determines whether their sales of XRP were an investment contract, and that it will not seek to establish that secondary market XRP transactions violate the Securities Act or the Securities Exchange Act, Intervenors’ need for participation in this matter may be limited.”

Moreover, Ripple points to the SEC’s ambiguity. “Recently, Judge Netburn rightly identified this same ambiguity and asked the SEC whether its position in this case is that “every individual in the world who is selling XRP [is]committing a Section 5 violation”. So with the motion to intervene, the SEC now has a chance to confirm that its lawsuit is not intended to affect the secondary market for XRP in the United States. However, Ripple’s lawyers also state:

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If, however, the SEC continues to equivocate and refuses to clearly state its position on these issues, Intervenors’ interest in the outcome of this litigation could be different. […] But Defendants take no position at this time as to whether intervention or some other, more limited, participatory rights – such as “elevated amicus status” – are appropriate

As Deaton explained via Twitter, Ripple cites a couple of cases in the brief in which the court offered “enhanced amicus status” after denying a motion to intervene.

This would permit #XRPHolders to ‘aid the court and offer insights by filing briefs and presenting arguments that respond to the issues presented by the parties.’ If we don’t get to intervene then hopefully the judge will allow us to participate in this manner.

The SEC maintains its ambiguous position

Predictably, the SEC opposes the intervention by Deaton and his now more than 10,500 supporters. The regulator argues that Deaton does not explain what claims he intends to bring against it. Moreover, it says, the SEC is not liable:

But Congress has barred by statute the consolidation or coordination of claims without the SEC’s consent, and sovereign immunity bars Movants’ claims against the SEC. That alone precludes Movants’ proposed intervention. Intervention should be denied for other reasons.

Further, the SEC alleges that Deaton and the intervenors are only seeking a relisting on crypto exchanges to “resume speculative trading” of XRP, which the SEC claims is evidence that Ripple Labs “offered and sold XRP as a speculative investment.”

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The SEC’s third argument is that allowing intervention would create an “avalanche” of claims and “almost certainly undue delay, complexity, and confusion.” Among others, the parties to the Zakinov case would also be allowed to intervene.

To that extent, it appears the SEC has no intention of backing down from its ambiguous position and providing clarity for the secondary XRP market.

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XRP

XRP – Assessing the odds of it climbing past $5 in 2022

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It has been a strong year for the collective crypto-market. Any asset in the top 10 would agree with this assertion, but this wouldn’t be the case for XRP. While on the rankings it remains 7th, its April 2021 high of $1.966 is yet to be tested again.

From a long-term perspective, every top asset managed a new ATH over the last few months. This list includes Bitcoin, Ethereum, and Cardano. For XRP, however, its 2017 high still stands.

Consistent momentum hasn’t been on its side after the SEC fiasco. Alas, structurally, its market might be undergoing a massive shift in the coming months.

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However, it is important to note that the direction of XRP’s price will still depend on several external factors. The following article will outline the bullish parameters which may trigger its rally.

XRP to return to the top 3?

At press time, XRP was ranked 7th on the charts with a market cap of $52 billion. Binance Coin was at 3rd with a valuation of $82 billion.

XRP hitting $82 billion on the charts would mean a spike of about 60% to $1.75. According to the market structure, this target could be extremely viable.

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Source: Trading View

Taking the example of the 1-day chart – XRP has been consolidating strongly in the liquidity pocket (highlighted in the chart) over the past month. With a prominent symmetric triangle forming at press time, the potential to breach and rally towards its immediate resistance of $1.40-$1.50 is fairly high.

One confirmation can be attained from the fact that lower trading volumes have been met by declining prices, which means any trading volume spike would automatically trigger an incline.

However, XRP’s reach might not only be limited to $1.40 or $1.50 anymore. The asset could be looking at the possibility of hitting its 2017 ATH by end of December and continuing its rally next year.

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Source: Twitter

The monthly chart for XRP, considering it explodes in the desired direction, seems to be structurally targeting a massive breach of $10 on the chart.

Now, while such a movement is almost unfathomable, there may be a few narratives slowly swinging in XRP’s favour.

Coinbase, SEC, and Warren Buffett?!

SEC started reeling in the pressure on Ripple late last year and in December 2020, it filed an action against the organization and two of its executives. XRP’s value tanked during a collective bullish period and then, Coinbase announced its delisting on 19 January.

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Its been 10 months since the lawsuit was filed and until now, Ripple has not been found guilty. Over the past couple of months, the momentum has shifted towards Ripple. In fact, the SEC has been ordered by Judge Sarah Netburn to offer clearer explanations as to why the Howie test applies to XRP, and not Ether and Bitcoin.

Jeremy Hogan, a vocal attorney in the XRP-SEC lawsuit, stated,

“UH-OH. The SEC is going to be forced to admit that there is nothing in an of these contracts that created an expectation of profits by purchasers of XRP. That’s a big problem for the SEC.”

With positive developments slowly surrounding XRP and Ripple, a part of the community believes that it is only a matter of time before XRP is re-listed on Coinbase.

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While both these narratives directly impact the valuation of XRP, the Warren Buffett angle might be one for the long term.

According to reports, Berkshire Hathaway has invested $500 million in Brazil-based NEO bank, which is an existing RippleNet member utilizing its ODL services.

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It can be speculated that Buffett saw some form of intrinsic value in Ripple’s ODL remittance services. This may have led to this massive investment.

Don’t count your chickens before they hatch

Regardless of the enticing narratives, it is essential to understand that such price jumps (if only) for XRP might come over the next few months and quarters, and not weeks.

It is still important to understand market dynamics before investing in an asset that has juggled market and legal volatility for over a year. Hence, as always, Do Your Own Research because this isn’t investment advice.

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Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Pioneer crypto to retrace briefly while altcoins go higher

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  • Bitcoin price might retreat to $56,000 as investors continue to book profit.
  • Ethereum price also prepares for a sub-$4,000 pullback.
  • Ripple price edges closer to a breakout from a bullish pennant pattern.

Bitcoin price continues to move sideways above a crucial psychological level. As long as support holds, BTC is in no trouble, however, if it breaks lower, it will likely drag Ethereum and Ripple along with it. Although this descent is likely to play out in the short term, it may be required to start a second leg-up.

Bitcoin price needs to correct

Bitcoin price is stuck producing lower highs and lower lows since rolling over at the October 21 $67,016 swing all-time high. While this pullback is currently stabilizing above the $60,000 support level, a breakdown could exacerbate the downswing and knock BTC down to the liquidity area, ranging from $52,595 to $56,004.

A dip into this zone will provide an opportunity for the sidelined buyers to jump on the bandwagon for the next leg-up. It will also allow investors to book profits, creating a double pressure of sorts. When this development reaches an inflection point, BTC will trigger a new bull run.

As for the upside, Bitcoin price will first encounter the $70,000 psychological level. Clearing this barrier will open the path to retest the 161.8% trend-based Fibonacci extension level at $77,525, a new all-time high.

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BTC/USD 1-day chart

BTC/USD 1-day chart

While things are looking up for the big crypto, a breakdown of the liquidity area’s lower limit at $52,956 will put Bitcoin price in a tough spot. While this move does not invalidate the bullish thesis, it will delay it. 

In such a case, BTC might revisit $50,000 before restarting the uptrend.

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Ripple increases stronghold in Middle-East with on-demand liquidity deployment

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  • Ripple has partnered with financial services company Pyypl to facilitate ODL using its native XRP crypto.
  • This will allow for instant and low-cost cross-border payments while eliminating the need of costly pore-funded accounts.

San Francisco-based blockchain startup Ripple is increasing its stronghold in one of the strongest remittance corridors – the Middle East and North Africa (MENA). On Monday, October 25, Ripple said that it is preparing for the first-ever in-market On-Demand Liquidity (ODL) deployment for the Middle East.

For this, Ripple has partnered Pyypl, an international blockchain-based financial services tech company. This on-demand liquidity deployment will leverage Ripple’s native cryptocurrency XRP. It will further help in facilitating instant and low-cost cross-border payments while eliminating the need for costly pre-funded accounts.

Pyypl noted that this is part of the company’s larger mission to enable digital payments for a billion smartphone users in Africa and the Middle East. As said, the OLD deployment will help Pyyl to solve one of the biggest issues of pre-funded accounts as seen with traditional cross-border payments.

Pyypl’s co-founder and CEO Antti Arponen referred to these legacy accounts as “inefficient use of capital”. He further noted that unlocking these previously trapped funds can help to better grow and scale the businesses. Arponen said:

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We’re excited to be Ripple’s first partner of choice to bring the deployment of ODL to the Middle East. This enables our ever-increasing number of users to deliver remittances instantly and cost-effectively. We’ve also reduced our inefficient use of capital through ODL, and look forward to an exciting rollout of its capabilities across the region.

Unlocking massive opportunities in the MENA market

The traditional players in cross-border payments have been pretty laggard in implementing innovative solutions. Ripple is solving the trillion-dollar challenges of this industry using its ODL services.

Besides, Ripple notes that the Middle East caters to two of the world’s three largest remittance corridors with Saudi Arabia and the UAE. Last year in 2020, the Middle East handled combined payments worth $78 billion. Besides, the Middle East has made a rapid transition to digital in the last year as it prepares for the upcoming FinTech revolution. Brooks Entwistle, Managing Director of RippleNet in APAC and MENA said:

MENA continues to be a critical region for Ripple thanks to our outstanding roster of customers, a welcoming regulatory environment and a regional focus on the needed improvements in the current financial system. The establishment of yet another first-in-market ODL launch demonstrates the understanding that digital assets will play a central role in the future of global payments. We are delighted to partner with forward-thinking companies, like Pyypl, to ensure we can continue to break the status quo in the current global financial system to continue delivering the best experience for customers.

Before entering the MENA market, Pyypl has already started its ODL services in the Philippines. Pyypl holds the license from ADGM’s Financial Services Regulatory Authority.

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The announcement has not had a major impact but Ripple’s XRP continues to trade just above $1.10 after gaining around 2 percent in the last 24 hours.

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