XRP price hinges on SEC’s next move in the Ripple case. Uncertainty persists, but potential for breakout if appeal is dropped. Macro headwinds also in play.
On Saturday, February 8, XRP advanced 0.89%, following a 3.11% rally on Friday, closing at $2.4196. The cryptocurrency outperformed the broader market, which saw a 0.51% increase, pushing the total market capitalization to $3.11 trillion.
However, XRP’s price remains below key resistance levels, leaving investors cautiously optimistic.
SEC Under Pressure: OIG Investigation and Legal Challenges
The Securities and Exchange Commission (SEC) and the Office of Inspector General (OIG) are facing mounting scrutiny regarding potential conflicts of interest in the crypto space.
Empower Oversight, a US whistleblower organization, has sued the SEC, demanding the release of the OIG’s findings from an investigation into crypto-related conflicts of interest within the agency.
At the center of this controversy is former SEC Director of the Division of Corporation Finance, William Hinman. In 2018, Hinman stated that Bitcoin (BTC) and Ethereum (ETH) are not securities. However, at the time, he maintained ties with Simpson Thacher, a law firm promoting Enterprise Ethereum.
Empower Oversight alleges that Hinman received millions from his former employer while playing a crucial role in shaping the SEC’s crypto regulations.
Hinman’s Role and the Ripple Case
On February 8, Hinman appeared as a panelist discussing regulatory developments under the new Trump administration. Attorney John E. Deaton highlighted concerns regarding Hinman’s Ethereum speech, pointing out that multiple SEC divisions reviewed his draft speech—except the Ethics Division.
Deaton noted that despite warnings from the SEC’s Ethics Division, Hinman continued meeting with Simpson Thacher employees, raising questions about regulatory impartiality.
The SEC has unsuccessfully attempted to shield documents related to Hinman’s speech under attorney-client privilege. This ongoing legal battle is fueling speculation that the SEC may eventually withdraw its appeal in the Ripple case.
The agency filed its appeal-related opening brief on January 15, just before Gary Gensler stepped down as SEC Chair.
The appeal seeks to overturn Judge Torres’ July 2023 ruling, which found that Programmatic Sales of XRP did not satisfy the third prong of the Howey Test—critical in determining whether an asset qualifies as a security.
XRP Price Trends: Is a Breakout Imminent?
XRP’s near-term trajectory is largely dependent on the SEC’s next move in the Ripple case. If the SEC withdraws its appeal, XRP could surpass its all-time high of $3.5505 and potentially target $4.
Additionally, the approval of an XRP-spot ETF could further drive institutional demand. Conversely, if the SEC proceeds with its appeal, XRP might decline toward $1.50.
Market Outlook: Regulatory Uncertainty and Macroeconomic Factors
Regulatory uncertainty remains a key risk factor for XRP’s outlook. In addition, macroeconomic elements such as US foreign policy and Federal Reserve interest rate decisions could impact investor sentiment.
While Trump’s re-election initially boosted market confidence, his recent tariff policies have pressured XRP prices. The cryptocurrency dropped from $3.1341 to a February 3 low of $1.7938 on tariff concerns before partially recovering.
Next SEC Meeting: Could It Decide XRP’s Fate?
The SEC’s next closed meeting on Thursday, February 13, could be a pivotal moment for XRP. According to the Sunshine Notice Act, the agenda includes:
1. Institution and settlement of injunctive actions
2. Institution and settlement of administrative proceedings
3. Resolution of litigation claims
4. Other enforcement-related matters
Notably, Jorge Tenreiro, a key SEC crypto litigator involved in the Ripple case, has recently transferred to another division. His absence could influence the SEC’s decision on whether to continue or withdraw the appeal.
XRP Price Trends: Impact of SEC Appeal Strategy
On February 10, XRP’s rocketing 1.12% closing at $2.4290. The broader market also declined slightly by 0.13%, bringing total market capitalization to $3.1 trillion.
Uncertainty surrounding the SEC’s appeal strategy continues to be a headwind for XRP, with ETF approval potentially depending on the agency’s decision.
Key Price Scenarios for XRP:
1. Bullish Case: If the SEC withdraws its appeal, XRP could rally past $3.5505 and beyond.
2. ETF Catalyst: Approval of an XRP-spot ETF could push XRP toward $5 on increased institutional demand.
3. Bearish Case: If the SEC proceeds with its appeal, XRP could decline below $1.50.
Beyond Ripple: US Tariffs and Crypto Market Impacts
The broader crypto market faces additional headwinds from US tariff policies, particularly impacting BTC. On February 9, The Kobeissi Letter reported that President Trump plans a 25% tariff on aluminum and steel imports.
Reciprocal tariffs on certain nations may also take effect, depending on China’s tariff decisions on February 10. Such tariffs could elevate import costs, drive inflation, and potentially delay Federal Reserve interest rate cuts—negatively affecting risk assets like BTC.
Conclusion
As regulatory and macroeconomic factors shape the crypto landscape, two critical developments stand out that the SEC’s appeal strategy in the Ripple case.
That factor could significantly influence institutional adoption, investor sentiment, and price movements in the coming months. Traders and investors should closely monitor regulatory updates, macroeconomic indicators, and technical signals to navigate this evolving market environment.