- XRP’s Open Interest surges amid Ripple vs. SEC settlement hopes.
- SEC reduces penalty demand from $2B to $103M.
- Ripple requests penalties capped at $10M, citing Terra’s $420M civil penalty.
XRP, the cryptocurrency at the heart of the ongoing Ripple vs. SEC lawsuit is experiencing heightened interest from traders, as evidenced by a surge in Open Interest (OI). This uptick in OI, coupled with recent price movements, suggests growing optimism about XRP’s potential price appreciation as settlement hopes in the legal battle rise.
As per CryptoQuant’s analysis, a rise in OI alongside price indicates growing trader interest, meaning investors are increasing their stakes with the expectation of an XRP price increase.
While OI reflects investor expectations and actions, it can also lead to sudden market volatility. Hence, it is crucial to monitor market fluctuations closely and prioritize risk management before making any investment decisions.
The SEC vs. Ripple lawsuit is one of crypto’s most intense legal fights. In 2020, the U.S. regulator accused the blockchain firm of offering XRP as an unregistered security. Although the court ruled that the Ripple-affiliated token was not a security, the token’s offering to institutional investors was deemed a security under federal law. The legal fight escalated when the regulator initially sought $2 billion as a penalty. However, after Ripple countered with an offer of up to $10 million, the regulator scaled back its demands to $103 million.
In the latest filing, the SEC defended the amount, arguing that it was necessary to “deter future misconduct in the crypto industry.” Ripple, however, remained steadfast in its claim, requesting the judge to ensure that the company pays “no more than $10 million” in penalties. The blockchain firm referred to the recent $4.47 billion settlement between Terra and the regulator, which resulted in just a $420 million civil penalty, as a benchmark for fairness.
It is noteworthy to mention that the SEC did not include a settlement offer in its latest court filing. Nevertheless, the $102.6 million penalty floor for violating US securities laws was much lower than its initial demand for an almost $2 billion penalty and an injunction.
Ripple expects a court verdict within the next few months.
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