XRP Treads Water as Investors Await an SEC v Ripple Court Ruling

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Bob Mason

Sat, May 21, 2022, 7:29 PM 5 min read

It was a been a range-bound start to the weekend. On Saturday, XRP rose by 1.02% to end the day at 0.4141
This week, the SEC filed its response to Ripple’s reply to the SEC brief on the Hinman docs and attorney-client privilege.
The court ruling could materially influence the outcome of the SEC v Ripple case and XRP price action.

A lack of progress in the SEC v Ripple case remains a drag on XRP. On Saturday, XRP rose by 1.02%. Partially reversing a 2.40% decline from Friday, XRP ended the day at $0.4141.

A bearish start to the day saw XRP fall to an early morning low of $0.4030 before striking a high of $0.4175.

While XRP left the day’s Major Support and Resistance Levels untested, support at $0.40 was the key.

There were no major news updates from the SEC v Ripple case to provide direction. Market participants are awaiting a court ruling on an SEC brief that documents and emails relating to William Hinman’s 2018 Speech are protected by the attorney-client privilege.

William Hinman Remains a Central Figure in the SEC v Ripple Case

William Hinman, former SEC Director of the Division of Corporation Finance, has become a central figure in the ongoing SEC v Ripple case.

In a 2018 speech, Hinman said that Bitcoin (BTC) and Ethereum (ETH) are not securities.

Since a defense motion, in August 2021, to compel the SEC to provide documents and emails about the Speech, the SEC appears committed to shielding the speech-related documents.

Earlier this month, Ripple defense lawyer Matthew Solomon had opposed at least the sixth SEC motion “filing in opposition to Defendants’ August 10, 2021, motion to compel.”

As previously stated, Solomon noted,

“Since the Defendants filed this motion to compel nearly nine months ago, the Court has twice overruled the SEC’s improper deliberative process privilege objections. Notwithstanding that, and close of fact and expert discovery, the SEC continues to withhold all documents related to a former SEC official’s June 14, 2018 speech.”

Since both parties have responded to the SEC brief, it now sits with the Court to make a ruling.

Considering the SEC’s fervent efforts to shield the documents, information within the documents is likely to be material to the case and possibly influence the outcome.

A ruling in favor of Ripple could materially balance the scales in favor of the defendants.

While parties concerned and the markets await a court ruling on the Hinman documents, Ripple has also been pushing for the SEC to deliver on Requests for Admissions (RFAs).

Ripple Seeks to Compel the SEC to Deliver on Requests for Admissions

As shared by defense attorney James Filan, Ripple filed a Motion to Compel concerning the SEC’s failure to respond to the Defendants’ fourth set of RFAs.

The Ripple Defense focused on seven key areas and 53 RFAs to which there is no real dispute and 26 RFAs seeking authentication of record remarks by SEC Commissioners and senior officials.

The areas of focus include,

Inquiries about XRP, received by the SEC’s Office of Investor Education and FinHub.
Watch lists in relation to XRP.
SEC trading policies.
Ripple’s 2013 meeting with the SEC and other regulators.
No-Action Letters.
Completeness of the SEC’s document production
Authenticity of recorded remarks by SEC personnel.

The RFAs in the category of authenticity of recorded remarks by SEC personnel have drawn media interest.

Here, the Ripple Defense is merely requesting the SEC to,

“concede the genuineness of a limited number of recorded public remarks made by the SEC’s own commissioners and senior officials while they served the SEC – all but one of whom are custodians in this litigation for discovery purposes.”

For each RFA, totaling seven, the SEC needs to,

“Undertake a reasonable inquiry and admit or deny the request – including a working hyperlink to the recording, the speaker, and the location and the date of the remarks.”

To date, the SEC has reportedly refused to admit or deny the authenticity of the recorded statements, claiming insufficient information. Among the recordings is one of William Hinman.

XRP Price Action

At the time of writing, XRP was down 0.05% to $0.4139.

Technical Indicators

XRP will need to avoid the $0.4201 pivot to target the First Major Resistance Level at $0.4201. XRP would need broader crypto market support to break out from Saturday’s high of $0.4175.

In the event of an extended rally, XRP should test the Second Major Resistance Level at $0.4260. The Third Major Resistance Level sits at $0.4405.

A fall through the pivot at $0.4115 would bring the First Major Support Level at $0.4056 into play.

Barring another extended sell-off throughout the day, XRP should avoid sub-$0.3950. The Second Major Support Level at $0.3970 should limit the downside.

The EMAs and the 4-hourly candlestick chart (below) send a bearish signal. At the time of writing, XRP sits below the 50-day EMA, currently at $0.4294. This morning, the 50-day EMA pulled back from the 100-day EMA. The 100-day EMA also pulled back from the 200-day EMA, XRP negative.

A move through the 50-day EMA would support a return to $0.50. A court ruling on the SEC’s claim of attorney-client privilege will be the key.