This week marks four years since the SEC filed its XRP and Bitcoin Face, Chris Larsen, and Brad Garlinghouse. Due to the SEC v. Ripple litigation, XRP investors have been through a lot of trouble. With a market cap low of $0.1009 in March 2020, XRP has fallen from its position as the second most valuable cryptocurrency since December 2020.
As a result, XRP and Bitcoin Face surged to a high of $2.9070 in December 2024. People hope the Ripple case will finally come to a close because of Trump’s pro-crypto agenda and re-election. Nevertheless, the most recent moves by the SEC indicate that the agency will file its opening brief in anticipation of the January 15 deadline in order to pursue its appeal.
SEC Strengthens Enforcement Ahead of Ripple
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Since former SEC Chair Jay Clayton filed the Ripple case in his last days as SEC Chair, the significance of the four-year milestone may be justified. By submitting the opening brief, Chair Gensler might make history again.
XRP Decline Amid SEC Uncertainty, Optimism Builds
Anxieties over the SEC’s intentions have weighed on XRP’s decline from its December peak. Still, things seem positive in the long run. A former head of an SEC division and legal experts are of the opinion that Paul Atkins, the newly-elected chair of the SEC, will turn around on the agency’s crypto-enforcement initiatives.
The burden of abandoning the appeal would fall on Paul Atkins if the SEC were to file its opening brief. This might put XRP in a precarious position if it takes too long. According to SEC internal regulations, it is not the chair’s decision alone but an agency vote that decides whether to continue or withdraw the appeal.
Investigating purported Crypto conflicts of interest within the SEC could provide unexpected results. There might be a lot of political pressure on the SEC to drop its appeal if the Office of the Inspector General determines that the agency has a conflict of interest. An important precedent would be established by the Programmatic Sales of XRP judgment.
XRP Rebounds as SEC Decision Looms
After dropping 1.58% on Sunday, XRP rebounded 2.62% on Monday, December 23, and closed at $2.2587. The cryptocurrency market as a whole increased in value by 1.57%, reaching $3.250 trillion, but XRP was the clear winner.
While investors wait for word of the SEC’s intentions to appeal verdicts in the Ripple case, XRP has been relatively stable in recent sessions. There might be a lot of selling pressure on XRP if the agency files its opening brief, and it could fall below $1.50. If it were to withdraw, XRP’s value might rise to $3.5505, its all-time high reached in January 2018.
Bitcoin Losses Extend as Fed Outlook Impacts ETFs
On Monday, bitcoin (BTC) extended its losing streak to three sessions as investors continued to recoil from Wednesday’s hawkish Fed economic projections. Notably, the hawkish Fed rate path outlook impacted demand for US BTC-spot ETFs, pulling BTC back from the crucial $95k level.
According to Farside Investors:
- On Monday, Fidelity Wise Origin Bitcoin Fund (FBTC) saw net outflows of $146 million.
- Grayscale Bitcoin Trust (GBTC) had net outflows of $38.4 million.
Excluding BlackRock’s (BLK) iShares Bitcoin Trust (IBIT) flow data, the US BTC-spot ETF market reported net outflows of $258.2 million. Notably, the US BTC-spot ETF market faces its longest outflow streak since early October. The latest flow trend underscores the Fed’s influence on BTC demand.
MicroStrategy’s Latest Bitcoin Purchase Follows Saylor’s Plan
In the meantime, Michael Saylor, founder and chairman of MicroStrategy (MSTR), made an announcement about the latest Bitcoin purchase by the firm. He stated,
There was a deficit in the supply-demand balance due to the acquisition and three days of Bitcoin outflows totalling $1,207 million. Saylor recently advocated for a strategic bitcoin reserve (SBR), and the acquisition of BTC followed suit.
US Job Data and BTC-ETF Flows to Influence Bitcoin Price
US BTC-spot ETF flows, news pertaining to SBR, and Thursday’s unemployment claims data will continue to shape the near-term patterns in Bitcoin price. The flows of BTC-spot ETFs may be impacted if the US job market data came out hotter than expected, which would indicate a more hawkish outlook for the Fed’s interest rates. If demand for bitcoin drops due to spot ETF market outflows, the price of bitcoin might fall below the $90,742 support level.
One thing that could enhance wagers on a Fed rate drop in Q1 2025 is an unexpected rise in jobless claims. If the Federal Reserve takes a more dovish stance and moves closer to an SBR, spot ETF inflows and Bitcoin might reach $100,000.
Summary
At the end of 2024, XRP and BTC will both encounter turning points. XRP and Bitcoin Face is still linked to the movement of exchange-traded funds and general economic patterns, but the future of XRP is dependent on the actions of the SEC and Ripple’s continuing legal struggles. The cryptocurrency market is ripe for massive changes as the United States’ stance on digital assets takes shape. Read on for the most recent market analysis and commentary from industry insiders.
FAQs
How does the SEC's stance affect XRP's price?
The SEC's decision to appeal or withdraw from the Ripple case can significantly influence XRP's price. An appeal could push prices lower, while withdrawal might lead to a price surge.
What role does the Federal Reserve play in Bitcoin price movements?
The Federal Reserve's monetary policy affects Bitcoin prices, particularly interest rate decisions. Hawkish stances typically reduce investor appetite for risk assets, leading to BTC price declines, while dovish signals can boost prices.
How do BTC-spot ETFs influence Bitcoin's market value?
Flows in and out of BTC-spot ETFs reflect investor sentiment and liquidity. Large outflows can drive BTC prices down, while inflows indicate strong demand, potentially pushing prices higher.
What is the significance of MicroStrategy's Bitcoin purchases?
MicroStrategy's BTC acquisitions often reflect bullish market sentiment and can tighten supply, positively influencing prices. Michael Saylor's strategic reserve advocacy also signals confidence in Bitcoin's long-term value.
