You may not be an XRP investor, but what those that put their funds in the digital currency are going through at this time is a cause for concern to all in the crypto community. This is not just about the US investors but all holders of the ripple currency who have borne the impact of the stance of the Securities and Exchange Commission (SEC).
To understand what these investors are going through, you just have to look at the coin market chart, which shows that ripple has been negatively impacted by the SEC stance which resulted in a lawsuit that has dragged on for many months.
XRP Lagging Behind
While many digital currencies such as Bitcoin and Ethereum have outperformed their past all-time-high records of 2017, XRP, the Ripple currency has been struggling due to the uncertainties caused by the legal action and the general unfavorable stance of the securities regulator.
This situation leaves the investors with little or no option than to short their XRP with the hope of moving on to other cryptocurrencies with prospects of giving them a better return on their investments. That this is happening in a bull market when most digital assets with high capitalization are making massive gains calls for concern.
You have to bear in mind that XRP rose up to $2 in April, 2021 but fell to 60 cents in July. These are some of the impacts of the travails that Ripple Labs, the company behind the digital currency is undergoing.
Nevertheless, a close look at the XRP chart shows that the coin has been undergoing a healthy price action with the critical support unbridled. This can be seen from a cycle that has seen the price of XRP not falling below the lower 60 cents which has been a critical support for the coin in months.
Call for Congress Intervention
The CEO of Ripple, Brad Garlinghouse recently called on the US Congress to intervene in the matter between the company and Ripple Labs. Garlinghouse is asking that the lawmakers provide clarity with regards to regulation of the asset which SEC insists is a security.
The court case which is still in the discovery phase will progress having been adjourned to January 15, 2022. The issue in contention is that the company made sales of the ripple currency to the tune of $1.38 billion which the regulator considers a security.
Despite the fact that cryptocurrencies are largely unregulated, it is rare for stakeholders in the industry to solicit for regulatory oversight the way Garlinghouse has done. This could be an indication of the pressure that the company is going through since the lawsuit commenced last December.
A Weak Case For SEC?
Nevertheless, what we have seen so far is that the SEC seems to be the one on trial with many observers stating that the agency did not prepare a solid case against Ripple.
Regulation of cryptocurrency in the US is a big deal. We are also aware that negative pronouncements against XRP will have a ripple effect on the coin market. This is why the industry is keeping a close look at the case between Ripple and the SEC.
There are indications that the company and SEC would reach a settlement out of court. This is not the first time that the rumor has made rounds. Unfortunately, this is yet to materialize.
In any case, we do know that the SEC vs Ripple Labs suit has had negative impacts on XRP investors. We are aware also that if the case drags on, the impact of the negative publicity would be borne by the crypto industry.