XRP Climbs on the 4Th Spot Among Cryptocurrencies Following Ripple’s SEC Triumph
[TL; DR]
The US Court ruling on XRP created much Optimism in the crypto market which led to the price surge of several top cryptocurrencies.
After the court ruling XRP moved from 7th position to the 4th spot on the crypto ranking.
Several crypto exchanges including Gemini, Coinbase, Bitstamp and Kraken have promised to relist XRP.
Introduction
Ripple’s win against SEC’s lawsuit led to an astronomical rise in the value of the XRP crypto. This follows the SEC against Ripple legal battle that stretched from 2020 to 2023. In 2020 SEC sued Ripple alleging that its cryptocurrency, XRP, is a crypto security. In this analysis, we discuss how Ripple’s partial triumph against the SEC led to the XRP price surge.
XRP Occupied 4th Spot on the Global Crypto Rankings
The payment-focused cryptocurrency, Ripple (XRP), has surpassed BNB in terms of market capitalization to occupy the 4th position on the global crypto rankings. In fact, XRP’s market capitalization increased by $21.2 billion to a new high of $46.1 billion. With such a surge in market capitalization, it toppled both Circle’s USD Coin (USDC) and Binance’s BNB (BNB) to become the new number 4 ranked cryptocurrency.
As a fact, XRP’s market capitalization grew by 84% following Ripple Labs partial victory against the the Securities and Exchange Commission on July 13. As of 14 July, XRP had a market capitalization of $42.5 billion.
Is XRP a Crypto Security
The price of XRP surged soon after Analisa Torres, the judge of the District Court for the Southern District of New York, ruled that the sale of Ripple crypto on cryptocurrency exchanges does not make it an investment contract or a crypto security.
The court declared that XRP only becomes a security when it is sold to institutional investors in which case it meets the Howey Test criteria. This court ruling was against the SEC lawsuit that sought to compel Ripple Labs to stop offering its XRP token without registration as it deemed it to be a crypto security.
Since the court ruling clearly specifies that XRP is not a crypto security if it is traded on crypto exchanges and through algorithms, several crypto exchanges like Gemini, Kraken, and Bitstamp have announced their intention to relist it.
In this respect, Coinbase did not waste much time as it announced that it will soon relist XRP once there is liquidity for it. It intends to have various pairs which include XRP-USD, XRP-EUR and XRP-USDT.
Another prominent crypto exchange, Gemini, aims to capitalize on the clarity that came out of the court ruling to list XRP for both spot and derivative trading.
Kraken, another top crypto exchange, has availed XRP trading to its United States based customers with immediate effect. This shows that Kraken has confidence in the recent court ruling.
Another reputable crypto exchange, Bitstamp, has expressed its interest to relist XRP as soon as possible. Since Ripple Labs, the company that owns XRP has a stake in Bitstamp, listing of the XRP token has much significance to the crypto exchange.
Read also: Bitcoin vs. Ripple: What’s the difference?
XRP Price Movement after the Court Ruling
According to TradingView the value of XRP increased by about 98% within hours of the court ruling to trade at $0.93. In fact, there was much rush to buy Ripple which caused a jam on the U.S. crypto exchange Uphold. As such, the exchange went down for a short time due to the “50x spike in volume.”
There is no doubt that there was much trading activity on Uphold, considering that it was one of the few remaining US-based exchanges that continued to offer XRP to the public.
It is important to note that the surge in the value of XRP affected the prices of other cryptocurrencies including BNB. The increase in XRP’s Theta Network price coincided with a decrease in the value of BNB. It is unclear whether or not there was a direct relationship between the two. Nevertheless, it is also important to note that before the XRP court ruling BNB’s market capitalization was double that of XRP.
In the meantime, Ripple’s several representatives have welcomed the ruling as positive and as per their expectations. For example, Garlinghouse tweeted “We said in Dec. 2020 that we were on the right side of the law, and will be on the right side of history. Thankful to everyone who helped us get to today’s decision – one that is for all crypto innovation in the U.S. More to come.”
Conclusion
The news of XRP’s partial victory against the US SEC caused the value of several cryptocurrencies to surge by double figures. Specifically, the price of XRP surged by around 98% resulting in a market capitalization of $46.1 billion. In the meantime, several crypto exchanges have promised to relist XRP following the court ruling’s clarification of the crypto regulation pertaining to securities.
FAQs About XRP
Did Ripple Win the SEC lawsuit?
Ripple had a partial win against SEC since the court ruling declared that XRP coins traded on crypto exchanges and through algorithms do not constitute securities. However, it ruled that when XRP coins are sold directly to institutional investors they become securities.
Why is XRP not a security?
The XRP coins that are offered through crypto exchanges and algorithms are not investment contracts. Therefore, they are not crypto securities. Only XRP coins that are sold directly to investors are securities.
What is Ripple case with SEC?
SEC sued Ripple on the pretext that it sold XRP without registering it as a security. According to Ripple most altcoins are securities based on the Howey Test criteria. However, a US court ruled that the XRP coins sold on crypto exchanges are not securities.
Why did Ripple go up today?
Ripple’s partial victory against the US SEC resulted in its sharp price increase on 14 July 2023. When several crypto exchanges promised to relist XRP, its price surged further.
