The recent approval by the US Court of Appeals regarding Ripple and the SEC’s Joint Stipulation for Dismissal has marked a significant end to an extended legal confrontation. The court’s endorsement indicates that the SEC has formally abandoned its appeal against Judge Torres’ ruling on the Programmatic Sales of XRP, which concluded that XRP should not be classified as a security per the Howey Test.
Earlier in 2023, this ruling was pivotal as Judge Torres determined that programmatic sales of XRP did not meet the criteria that would classify XRP as a security, eliciting attention from various market participants. John E. Deaton, an attorney involved as Amicus Curiae in the case, underscored the ruling’s importance for Exchange-Traded Fund (ETF) issuers. He noted that XRP Spot ETFs are now likely to gain approval, which could not have happened without the ruling. XRP holders played a crucial role in the court’s decision, reinforcing the notion that “XRP itself is not a security.”
Currently, 11 entities have submitted applications for XRP ETFs, including notable names like 21Shares, Grayscale, and WisdomTree. Among these, seven are awaiting a decision on their spot ETF filings, with crucial deadlines set between October 18 and 25, while Franklin Templeton’s deadline extends to November 14. The anticipated approval and subsequent launch of these XRP spot ETFs have the potential to act as significant price catalysts, possibly elevating the token to unprecedented highs.
Nate Geraci, President of NovaDius Wealth Management, cautioned against underestimating the demand for XRP spot ETFs, paralleling the investor enthusiasm seen with previous Bitcoin and Ethereum ETF approvals.
Moreover, the impending launch of the first US XRP ETF, the REX-Osprey XRP ETF, is poised to provide a preliminary gauge for the market’s response to XRP spot ETFs. The ETF employs a hybrid investment strategy, involving direct investments in XRP, XRP ETFs, and XRP derivatives. This launch, along with the upcoming GLS and REX-Osprey ETF projects, signifies a significant shift away from the previous anti-crypto inclinations of the Biden administration and SEC Chair Gary Gensler.
On September 17, XRP’s price rose by 1.53%, closing at $3.0838, clearly exceeding the broader market performance. The token has established critical support levels at $3, $2.8, and $2.5, while traders are eyeing resistance levels at $3.2, $3.335, and the all-time peak of $3.66.
Several imminent events are expected to influence XRP’s price trajectory, such as the REX-Osprey ETF launch, potential approvals or delays surrounding other XRP spot ETFs, and significant corporate engagements regarding XRP as a treasury reserve asset.
Furthermore, regulatory developments—including Ripple’s ongoing application for a US-chartered bank license and legislative activity surrounding the Market Structure Bill—may also impact XRP’s market dynamics and demand.
Scenarios for XRP’s future pricing exist on both sides of the spectrum. In a bearish scenario, if the REX-Osprey ETF experiences low inflows or if the SEC rejects XRP spot ETF applications, prices could drop below $3, testing the critical support levels at $2.8 and $2.5. Legislative hurdles or resistance from blue-chip corporations could further dampen investor sentiment.
Conversely, bullish prospects could unfold if the REX-Osprey ETF attracts strong demand or if BlackRock proceeds with an iShares XRP Trust filing, amplifying investor confidence. Favorable regulatory developments and broader adoption of XRP could pave the way for the price to rise towards $3.2, with the potential to break through and approach historical highs if sufficient momentum builds.
