Will Ripple Victory be Fuel for XRP to Exceed Previous ATH?

In a dramatic turn of events, the SEC vs Ripple case concluded last week with a significant victory for the crypto community. The Southern District of New York ruled that XRP is not a security, providing a much-needed boost for the embattled cryptocurrency. As a result, XRP surged by 75% in the last seven days, sparking speculation about its potential to surpass its previous all-time high (ATH) of just over $3, achieved back in January 2018.

The SEC vs Ripple Case: Background and Outcomes

The SEC brought a series of claims against Ripple and two of its execs, alleging that they made unregistered offers and sales of XRP, constituting investment contracts under the criteria set forth in SEC v Howey.

However, in a groundbreaking judgment, the court rejected the SEC’s argument, stating that XRP does not meet the characteristics of an investment contract, and therefore, is not a security under US law. This verdict was a major win for Ripple and the broader XRP community, effectively clearing a cloud of uncertainty that has been hanging over the cryptocurrency since December 2020.

The ruling is great news for the rest of the crypto industry. Ripple Chief Legal Officer Stuart Alderoty noted the following:

XRP’s Underperformance in the 2021 Bull Cycle

The fallout from the SEC’s lawsuit had far-reaching consequences for XRP’s performance during the 2021 bull cycle. While other cryptocurrencies soared to new heights, XRP struggled to gain momentum. At its peak, it reached just under $2 before experiencing a crash to lows of almost 30 cents, following the market implosions caused by Terra Luna and FTX.

With the SEC case now behind them, XRP enthusiasts are hopeful that this recent victory could signal a turning point for the cryptocurrency. The clarity around XRP’s status as a non-security could attract renewed interest from investors, paving the way for a potential resurgence in its value. The 75% price surge in the last seven days is seen as an early indicator of the positive sentiment surrounding XRP’s future.

Challenges Ahead: Wars, Recessions, Regulatory Enforcement, and Other Black Swans?

XRP still has a significant distance to cover before reclaiming its previous ATH of over $3. The cryptocurrency market is notoriously volatile, and external factors can heavily influence XRP’s trajectory.

There are a number of macro events that could affect the crypto markets, such as further chaos in the banking sector and wider economic problems as a result of years of excessive money printing (exacerbated by the response to Covid). There’s also the impact of the war in Ukraine to consider, and whether it will escalate beyond Ukrainian and Russian borders.

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However, to the surprise of many, Bitcoin and other cryptocurrencies rallied following the recent collapse of Silicon Valley and Signature Banks. This is an indicator that crypto could perform more like gold, rather than equities in the event of a major economic downturn.

Other potential catastrophes loom on the horizon and come from within the cryptocurrency ecosystem itself. One of the biggest threats to the stability of the crypto markets includes the regulatory pressure recently brought to bear on some of the biggest cryptocurrency exchanges.

Binance, the largest exchange, was recently charged by the SEC. If the accusations are true (which include the claims that Binance CEO CZ owns another company that was used to carry out wash trading on the Binance.US platform, while also co-mingling customer funds) the implications for the crypto market could be disastrous.

Do you think XRP will reach its previous ATH again?