SEC Appeal Drives XRP Price Decline
XRP has faced a sharp drop in price, declining nearly 13% over the past day to hit a monthly low of $0.511. The sharp price decline stems primarily from legal challenges involving the United States Securities and Exchange Commission (SEC) and escalating tensions in the Middle East.
This decline has wiped out most of XRP’s recent gains, causing uncertainty across the market. Notably, the SEC made a legal move to challenge Judge Analisa Torres’ decision from earlier this year.
Torres had ruled that secondary sales of XRP did not meet the SEC’s criteria to be considered securities. Legal experts had predicted the SEC would appeal, but the reality of this prediction still caused a 16% drop in XRP price after the appeal was filed.
This appeal casts doubt on the future of XRP’s classification. The possibility that a higher court could overturn the court’s current decision creates uncertainty for traders and investors.
Accordingly, many are reducing their exposure to XRP to mitigate potential losses. They fear that a reclassification of XRP as a security could disrupt the digital asset’s price action further.
Are Middle East Tensions Adding Pressure on XRP?
Meanwhile, the drop in this crypto’s price was not limited to the SEC’s legal maneuvers. Rising tensions in the Middle East have added further pressure on XRP, the crypto market and the broader financial markets.
Hence, investors are turning toward safer assets like the US dollar and government bonds, which have seen a notable rise in value as these geopolitical risks grow. These tensions are also affecting European stocks, with the Stoxx Europe 600 index dropping 0.8% across all sectors.
Similar patterns are emerging in US equity futures. These global risk-off sentiments are weighing on riskier assets like XRP, amplifying its price decline.
Nevertheless, XRP remains within an ascending price channel, with support emerging around the $0.50 to $0.52 range. In the past, this level has attracted buyers, providing some hope for a rebound.
However, a break below this channel could trigger more losses, with the next key support zone located around $0.4639. For now, XRP’s immediate future hinges on the outcome of the SEC appeal and how the situation in the Middle East unfolds.
Ripple CEO Brad Garlinghouse Vows to Fight SEC Appeal
Meanwhile, Ripple CEO Brad Garlinghouse has expressed his frustration following the regulator’s appeal of a July court ruling that favored Ripple in their longstanding case. In his post on X, Garlinghouse asserted that the SEC has yet to grasp the reality of the court’s decision.
“Somehow, they still haven’t gotten the message: they lost on everything that matters,” he wrote. He further emphasized that XRP’s current status as a non-security token is firmly established and won’t change despite the SEC’s latest appeal.
Ripple Legal Team Prepares for Lengthy Appeal Process
Garlinghouse also highlighted that Ripple is prepared to stay in court for as long as necessary, continuing to fight the SEC’s stance. This appeal stems from a partial win for the SEC in July when New York District Court Judge Analisa Torres ruled that Ripple’s XRP token was not a security when sold on public crypto exchanges.
However, the court ruled in favor of the SEC regarding institutional sales of XRP, fining Ripple $125 million. Notably, the fine has been stayed following the SEC’s announcement of its appeal.
Ripple’s chief legal officer, Stuart Alderoty, criticized the SEC’s lawsuit as “irrational and misguided,” reaffirming Ripple’s confidence in proving its case again in appellate court. Alderoty expressed disappointment with the SEC’s action, although he noted that it was not surprising.
Legal experts, such as Hodl Law founder Fred Rispoli, predict that a resolution from the Second Circuit Court of Appeals could take up to two years. Rispoli added that oral arguments will not be scheduled until late 2025, with a ruling likely delayed until early 2026.
This prolonged timeline suggests that Ripple and the SEC will be locked in another period of legal disputes for the foreseeable future.
