Market Turbulence: SEC's Ripple Appeal Silence and Bitcoin's Uncertain Path Ahead

SEC's Stance on Ripple Appeal

Better Markets has raised concerns about Judge Torres’ ruling on Programmatic Sales of XRP, highlighting several critical errors:

• The investment contract status relies on investors obtaining the investment directly from the issuer.
• Retail investors lacked the sophistication to grasp the connection between their anticipated profits and Ripple’s efforts to enhance the token's commercial applications.
• The court's application of the Howey Test could jeopardize the investor protection objectives of securities laws.

In July 2023, Judge Torres ruled that programmatic sales of XRP did not meet the third criterion of the Howey Test. The SEC responded by filing an appeal-related opening brief on January 15 to contest this ruling.

Better Markets CEO Dennis M. Kelleher, who was part of the Biden-Harris Transition team, has been vocal about the administration's anti-crypto stance, supporting the SEC's appeal despite the shifts in political climate.

SEC's Silence and Market Speculation

Better Markets submitted an Amicus Brief prior to the SEC's anticipated closed meeting on January 23. Speculations about the SEC possibly withdrawing its appeal in the Ripple case have emerged, but no updates have surfaced to enhance XRP demand.

Recent reports suggest that acting SEC Chair Mark Uyeda might pause crypto enforcement actions that lack fraud allegations, which could impact Ripple's case, especially since it falls under the non-fraud category. In August 2024, Judge Torres imposed a $125 million penalty on Ripple for illegally selling XRP to institutional investors, based on a civil violation of the US Securities Act.

XRP Price Trends in Focus

On January 23, XRP saw a 1.87% decline, closing at $3.1187, trailing behind the broader crypto market, which edged 0.08% higher. The uncertainty surrounding the SEC's appeal strategy is pivotal for XRP's near-term price action. A pause or withdrawal could potentially push XRP above its all-time high of $3.5505, while continuing the appeal might drag prices below $2.50.

Bitcoin's Market Movements

On the same day, Bitcoin experienced a volatile session, fluctuating within a $5k range influenced by regulatory developments. SEC Commissioner Hester Peirce announced the rescission of SAB 121, which could alleviate restrictions on banks holding crypto assets, potentially boosting BTC demand.

Discussions around the Strategic Bitcoin Reserve (SBR) gained traction, with commentary on President Trump’s BTC campaign pledge. If executed, such an order could significantly alter BTC's supply-demand dynamics.

Bitcoin Price Outlook

On January 23, BTC rose by 0.28%, closing at $104,004. It has remained above the crucial $100k mark for seven consecutive days, reflecting investor confidence in Congress approving a US SBR. BTC's price trends will depend on developments concerning executive orders and ETF flows.

Explore our expert analysis on the SEC’s next moves and their implications for XRP and BTC's future.