Crypto investors celebrated as one of the industry’s most protracted legal disputes faced a reversal from the U.S. Securities and Exchange Commission. However, according to experts in the field, the markets may have already anticipated this win well in advance of the official announcement.
On March 19, Ripple’s CEO, Brad Garlinghouse, disclosed that the SEC would withdraw its lawsuit against Ripple, concluding a four-year legal saga over an alleged $1.3 billion unregistered securities offering dating back to 2020.
Nonetheless, the outcome may not be as positive as it seems, as markets could have already factored in this news since the elections of President Trump, posits Dmitrij Radin, founder of Zekret and CTO at Fideum, a regulatory and blockchain infrastructure company catering to institutional clients.
The CEO of Ripple announced the SEC’s decision to drop the case against the blockchain firm.
“While it’s true they are discontinuing the case, the appeal was already underway,” he stated during the March 20 interview on a popular show:
“One of the longest-running and most discussed cases in crypto has reached its conclusion. This is positive for the market and allows Ripple to expand in the U.S. However, it seems to have already been factored into prices. I don’t anticipate any significant effect on market values.”
XRP/USD, 1-month chart
Despite an 11% relief rally following the March 19 announcement, the XRP (XRP) token struggled to maintain its position above the critical psychological level of $2.5. According to data, the token has seen a decline of over 6.3% since March 19.
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The SEC’s dismissal of the Ripple case was “expected” – Nansen analyst
Other analysts attribute the XRP token’s sluggish momentum to investor anticipation for an end to the SEC’s lawsuit against Ripple, compounded by overall negative market sentiment.
“I would attribute this to the market having already priced it in, along with the wider market conditions,” Nicolai Sondergaard, a research analyst at Nansen, mentioned, adding:
“Honestly, this outcome was somewhat expected by now, and the overall macro environment coupled with uncertainty isn’t helping XRP’s cause.”
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Nevertheless, some technical analysis suggests a potential 75% rally for XRP following the resolution of the SEC’s lawsuit.
XRP/USD weekly price chart
As of March 21, XRP rebounded after hitting the lower trendline of a triangle formation, with hopes of climbing toward the upper trendline around the $2.35 level by April. The ultimate target for this potential breakout is set at $4.35 by June, representing a 75% increase from current price levels.
Conversely, if the token falls below the lower trendline, it could invalidate the bullish outlook, steering XRP toward $1.28. This bearish target is calculated by subtracting the height of the triangle from the prospective breakdown point of $2.35.
Regardless of XRP’s price movements, the SEC’s decision to overturn the case is expected to have a favorable “long-term impact” on the market due to a shift in narrative and increased investor expectations for a more crypto-friendly regulatory environment, according to Radin.
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