- XRP price rose by more than 3.3% in the last 24 hours to breach the resistance of $0.667.
- Ripple whales have managed to sell over 60 million XRP worth $40 million in three days.
- The MVRV ratio shows that the altcoin still has room to rally before actually suggesting profit-taking.
XRP price is seemingly moving upwards once again, and that is considered by many to be a positive sign for their portfolios; interestingly, though, some have been a little too quick in picking up this signal, which has resulted in the selling of the Ripple native token ahead of time.
Daily Digest Market Movers: Ripple whales step forward to sell
Ripple whale addresses have shown a tendency to book profits a little ahead of time in the past as well, which generally results in selling before the price can hit the local peak. A similar behavior can be observed at the moment as well.
Whale addresses holding 1 million XRP to 10 million XRP tokens have sold over 60 million XRP worth over $40 million in the span of three days. Consequently, their holding currently stands at 3.72 billion XRP. These whales sold their supply just as the XRP price began rising in the last three days, including the increase in the last 24 hours where the altcoin shot up 3.68% over the past 24 hours.
Ripple whale holdings
However, their move was a little earlier than expected since, according to the Market Value to Realized Value (MVRV) ratio, these investors still had some room to grow. The MVRV ratio is an indicator that is used to assess the average profit/loss of investors who purchase an asset. The 30-day MVRV ratio measures the average profit/loss of investors who purchased an asset in the past month.
For Ripple, the 30-day MVRV sits at 6.7%, which indicates that investors who purchased XRP in the past month are sitting at 6.7% profit. These investors are likely to sell their holdings to realize profits; when MVRV hits 8% to 20%, XRP has undergone major corrections. If a similar outcome is observed this time around, it could trigger a sell-off, which is why this area is termed a danger zone.
Ripple MVRV ratio
Since MVRV is yet to reach there, the whales’ move appears to be a little premature, which also suggests that the XRP price might have room to grow.
Technical Analysis: XRP price rise restarts
XRP price, at the time of writing, was trading at $0.667, marking a 3.68% increase over the past day. The rise began over the past few days and pushed the altcoin to break through a key barrier at $0.644.
This resistance was last breached nearly three weeks ago, which marks a recovery for XRP price. Testing this line as support again would set the altcoin up for rising to $0.700. The price indicators are already hinting towards active bullishness, which is key to further recovery.
XRP/USD 1-day chart
However, if the cryptocurrency fails to breach the resistance at $0.693, XRP price might see a fall back to $0.644, and losing this support level would invalidate the bullish thesis, causing a decline to $0.600.
SEC vs Ripple lawsuit FAQs
It depends on the transaction, according to a court ruling released on July 14:
For institutional investors or over-the-counter sales, XRP is a security.
For retail investors who bought the token via programmatic sales on exchanges, on-demand liquidity services and other platforms, XRP is not a security.
The United States Securities & Exchange Commission (SEC) accused Ripple and its executives of raising more than $1.3 billion through an unregistered asset offering of the XRP token.
While the judge ruled that programmatic sales aren’t considered securities, sales of XRP tokens to institutional investors are indeed investment contracts. In this last case, Ripple did breach the US securities law and will need to keep litigating over the around $729 million it received under written contracts.
The ruling offers a partial win for both Ripple and the SEC, depending on what one looks at.
Ripple gets a big win over the fact that programmatic sales aren’t considered securities, and this could bode well for the broader crypto sector as most of the assets eyed by the SEC’s crackdown are handled by decentralized entities that sold their tokens mostly to retail investors via exchange platforms, experts say.
Still, the ruling doesn’t help much to answer the key question of what makes a digital asset a security, so it isn’t clear yet if this lawsuit will set precedent for other open cases that affect dozens of digital assets. Topics such as which is the right degree of decentralization to avoid the “security” label or where to draw the line between institutional and programmatic sales are likely to persist.
The SEC has stepped up its enforcement actions toward the blockchain and digital assets industry, filing charges against platforms such as Coinbase or Binance for allegedly violating the US Securities law. The SEC claims that the majority of crypto assets are securities and thus subject to strict regulation.
While defendants can use parts of Ripple’s ruling in their favor, the SEC can also find reasons in it to keep its current strategy of regulation by enforcement.
The court decision is a partial summary judgment. The ruling can be appealed once a final judgment is issued or if the judge allows it before then. The case is in a pretrial phase, in which both Ripple and the SEC still have the chance to settle.