SEC Challenges XRP Programmatic Sales Ruling: Will XRP Break $0.55?

• XRP remains below $0.55 as the SEC’s appeal on programmatic sales weigh on the market.
• The appeal challenges the July ruling, which cleared Ripple’s programmatic sales of XRP.
• Ripple stresses that the question of XRP not being a security is fundamentally settled.

XRP remains under pressure as the U.S. Securities and Exchange Commission (SEC) appeals a court ruling on Ripple’s programmatic sales. On October 18, XRP closed at $0.5474, a slight gain of 0.62% for the day but still below the key resistance mark at $0.55.

This comes as the SEC filed details challenging Judge Analisa Torres’s July 2023 decision, which stated that Ripple’s programmatic sales did not meet the criteria of the Howey Test. This legal move by the SEC spurred market speculation, with the outcome of the appeal potentially impacting the future of XRP.

XRP Price Struggles Amid Legal Battle

If the court upholds the initial ruling, XRP’s price could surge significantly, as it did in July. Meanwhile, Ripple’s Chief Legal Officer Stuart Alderoty emphasized that the question of XRP not being a security is fundamentally settled. He urged investors to focus on the status quo despite the SEC’s appeal and affirmed that XRP and its secondary trading do not qualify as securities. 

On Friday, the overall cryptocurrency market witnessed a 1.53% rise, pushing the total market cap to $2.294 trillion. However, XRP’s price remained stagnant as investors braced for potential legal outcomes.

Technical Indicators Show Bearish Trend

Technically, XRP is trading below key moving averages, including the 50-day and 200-day EMAs, signaling a bearish trend. According to analysts, if XRP fails to break above the $0.5739 resistance level, it could lead to further decline, dropping below $0.50.

Also, if the SEC appeal is rejected, it could spark a breakout to higher levels, with $0.6609 being a key target for bullish traders.

Spot ETF Applications in Jeopardy

Several firms, including Grayscale, Bitwise, and Canary Funds, have applied to launch XRP spot ETFs. These ETFs aim to provide investors with easier access to XRP through traditional markets. 

Grayscale has proposed converting its Digital Large Cap Fund (GDLC) into a spot ETF, with XRP making up a smaller portion of the fund’s holdings. While this could potentially increase institutional demand for XRP, the approval of these applications is apprehensive owing to the appeal. 

The SEC has taken a cautious approach to approving spot cryptocurrency ETFs, and the unresolved legal issues surrounding XRP may further delay these approvals. Should the SEC’s appeal succeed, the path for approving these ETFs could become more complex, potentially limiting broader market exposure to XRP.