On March 19, Ripple CEO Brad Garlinghouse announced that the U.S. Securities and Exchange Commission (SEC) would dismiss its long-standing legal action against Ripple Labs. This development marks the end of a contentious four-year litigation around an alleged $1.3 billion unregistered securities offering made by the blockchain developer in 2020. Although many investors initially celebrated this announcement, market analysts suggest that the effects of this decision may have already been reflected in the cryptocurrency markets prior to the official announcement.
Industry experts argue that the potential dismissal of the SEC’s case against Ripple had been factored into market expectations for some time now, particularly since the election of President Trump. Dmitrij Radin, founder of Zekret and Chief Technology Officer of Fideum, emphasized during a recent interview that while the SEC dropped the case, the details surrounding the appeal had already led market participants to speculate on this outcome.
Source: Brad Garlinghouse
Despite a brief relief rally of 11% following the SEC’s announcement, XRP, the token associated with Ripple, struggled to maintain momentum above a crucial psychological mark of $2.50. As of the latest reports, XRP has seen a decline of over 6.3% since March 19, which indicates that the announcement may not have had the immediate impact many anticipated.
Other analysts, including Nicolai Sondergaard from Nansen, also attribute XRP’s stagnation to the prevailing market sentiment and to the fact that the resolution of the lawsuit had become expected among investors. According to Sondergaard, the broader economic landscape and uncertainty in the markets may be overshadowing the potential bullish sentiment that could accompany the SEC’s decision.
XRP/USD weekly price chart. Source: TradingView
Despite the ebb and flow of XRP’s price, market analysts project that the long-term ramifications of the SEC’s case dismissal could foster a more favorable regulatory environment for cryptocurrencies overall. Radin suggested that this change in narrative regarding the SEC’s approach could open doors for further expansion of Ripple in the U.S. market.
While the immediate price reaction has not been as explosive as some might have hoped, the SEC’s withdrawal from this high-profile case could lead to a gradual shift in investor expectations and pave the way for increased adoption of cryptocurrency. Technical patterns indicate that if XRP can overcome recent resistance levels, it could see significant gains in the coming months.
