NOIDA (CoinChapter.com)—Ripple’s XRP token continues to navigate turbulent waters, both legally and in the market. Now, a crucial part of Ripple’s legal team has dashed rumors of a possible Ripple SEC settlement, sending fresh bearish cues for XRP across the market.
Since its peak in December 2017, XRP has not recorded new highs, languishing as investors ponder the implications of its ongoing legal battles with the US Securities and Exchange Commission (SEC) initiated in December 2020.
No Ripple SEC Settlement, Says Alderoty
In a recent development, Ripple’s Chief Legal Officer, Stuart Alderoty, addressed speculation regarding a potential settlement with the SEC. Alderoty quashed hopes of a Ripple SEC settlement, a possibly bullish cue for the platform’s XRP token.
Alderoty rejected rumors of a probable settlement with the SEC. The Ripple executive stated that he matters for pre-trial were dismissed when the SEC dropped charges against CEO Brad Garlinghouse and executive chairman Chris Larsen.
As a result, the focus now shifts to Ripple’s upcoming filings and the SEC’s responses. Rumors of a Ripple SEC settlement surfaced in late March 2024. A settlement between Ripple and the SEC would be bullish for XRP as it would mark the end of the legal battle and clarify the token’s regulatory and legal position.
Moreover, Alderoty highlighted that Ripple must file its opposition brief against the SEC by April 22, focusing on factors like pre-complaint proceeds from non-US investors and the absence of post-complaint sales to US institutions.
These points could significantly reduce potential penalties if the firm successfully demonstrates no financial harm to US investors.
The SEC is looking for nearly $2 billion in penalties against Ripple. Now, with chances of a settlement between the SEC and Ripple nearly down to zero, if the regulatory body succeeds, it could mark significant selling pressure for XRP.
Impact On XRP
Ripple might be forced to liquidate its XRP holdings to pay the fine, which would result in a supply shock to the market and a likely price crash for the token.
Furthermore, the ongoing uncertainty has rendered XRP a less attractive option for investors looking for stable returns. Analysis by CoinChapter analyst Yashu Gola earlier this month highlighted XRP’s inherent price volatility and its decreased utility in cross-border payments due to these fluctuations.
Additionally, the centralization concerns, with Ripple controlling a significant portion of the total XRP supply, further dampen the token’s appeal to decentralization enthusiasts, especially in light of the Ripple SEC settlement not happening.
XRP Price Moving Inside Bearish Pattern
Apart from the Ripple SEC settlement speculations dying out, another bearish cue for the Ripple token could be a bearish technical pattern called the ‘Descending Triangle.’
Market analysts predominantly consider the descending triangle a bearish continuation signal in a technical chart pattern. A downward-sloping upper trendline characterizes this pattern, with declining resistance levels that progressively lower the peaks of the price action.
Additionally, a horizontal lower trendline acts as support, maintaining a consistent low point that the price struggles to breach. The formation indicates that selling pressure is gradually increasing, overcoming the buying interest, as each rally is weaker than the last.
In a descending triangle setup, the height of the triangle’s thickest section determines the price target. If the bearish pattern pans out, the GALA coin price could drop over 42% to reach the projected price target near $0.28.
The XRP price is currently testing the pattern’s support trendline. Alderoty killing the Ripple SEC settlement rumors could force the token to break below the trendline and confirm the pattern. The lower highs of the weekly RSI highlight the decreasing price momentum of the XRP token.
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