Ripple Vs. SEC: Assessing an XRP Price Rally To $50
XRP price has lost much of its month-long upward momentum, making it brush shoulders with $0.55 twice before falling back down again. The small wins Ripple Labs has been bagging in court has improved sentiment among the XRP Army.
Even though the price corrected to $0.42, investors and experts are looking forward to XRP reclaiming its all-time high at $3.40 and blasting to $50 in the long term if there is a positive outcome from the lawsuit.
A win against the SEC (Securities and Exchange Commission) is crucial for this to happen. The SEC filed a lawsuit against Ripple Labs, the company behind the XRP token, and its top executives in December 2020.
The regulator alleged that Ripple sold unregistered securities (XRP), violating the Securities law. Almost two years after the filing, the court is yet to provide a ruling which some believe will impact the entire cryptocurrency industry. In other words, the court will determine what constitutes a security, setting precedence for other cryptos in the future.
What’s Pushing Ripple Labs to The Victory Line?
Two firms, I-Remit and TapJets, were recently allowed by the US District Judge Analisa Torres to act as amicus curiae in the Ripple Vs. SEC lawsuit. The judge ruled that both have until the end of October to file their amicus brief.
Moreover, the contents of the highly contested Hinman speech will now be accessible against the SEC’s wishes. Ripple has argued that the documents containing a speech by Willian Hinman, a former SEC commissioner, are essential to the case and must be considered.
In other words, Ripple expects to find the last bullet to use against the regulator regarding how Bitcoin (BTC) and Ethereum (ETH) were categorized as cryptocurrencies and not securities.
Deaton has commended XRP holders for their support during the whole process.
Monday, October 24, is critical to the lawsuit’s progress, with the SEC and Ripple expected to file publicly redacted versions of their opposition briefs.
A recent prediction by Finders’ panel estimates that the XRP price could tag $3.81 by the end of 2025 if the blockchain startup wins the lawsuit. Craig Cobb from Tradercobb.com was one of the most optimistic panelists, forecasting that XRP price may trade at $1.00 by December 31, 2022.
“The crypto market loves to jump on a bandwagon and XRP winning its case in a bear market could likely see herd mentality which will pump the price of this old-school top-10 coin.”
The most optimistic panelist from Finders was Martin Froehler, CEO at Morpher, who believes that XRP will grow to be worth $5 by 2025. He reckons it will be “a huge win for the entire crypto industry,” if Ripple wins the case.
From a technical perspective, XRP price is currently looking at a 45% move north if the double-bottom pattern plays out.
XRP/USD four-hour chart
A double bottom is a bullish pattern that appears after a prolonged downtrend. Usually, the trend changes bullishly with support at the second bottom, allowing buyers to take control. In the case of XRP, this rebound commenced as soon as the anchor at $0.42 was tested.
Now XRP price faces resistance marginally below the 50-day SMA (Simple Moving Average), red, and the 100 SMA, blue. This seller congestion zone must be weakened for XRP price to validate a 22% move from the breakout point (neckline) to $0.66.
The MACD (Moving Average Convergence Divergence) dons a buy signal. Traders should look forward to the MACD crossing above the mean line before banking on a significant positive outcome.
XRP price has performed exceptionally well over the last couple of months. From the above analysis, the token presents a buying opportunity with the potential to hit new highs in the coming months. However, the XRP rally depends on Ripple’s ability to win the case against the SEC.
For those traders that maybe can’t wait another few months for big gains, there are a number of smaller altcoins that have been beating the market in recent weeks, with presale tokens proving particularly lucrative.
One promising ongoing presale is Dash 2 Trade– a crypto analytics and intelligence platform for traders and investors. Think of it as a Bloomberg terminal for crypto enthusiasts.
In less than a week, D2T has raised more than $2 million in its presale, catching the attention of crypto investors worldwide. At a time where presales are doing particularly well, D2T is poised to continue this positive momentum.
While D2T’s future price history can’t be predicted, its fundamentals make it an interesting platform for investors and traders, so it has every chance of seeing a positive return once it secures its first few listings.
The market is currently in a news-driven environment where the prices of cryptocurrencies have been determined by news agenda rather than fundamentals.
Bitfinex analysts have warned crypto investors to be cautious as bitcoin’s (BTC) recovery over the weekend is not a sign that its correction is over; the asset could witness more bloodshed in the near term.
In the latest Bitfinex Alpha report, experts deemed the market’s reaction this week critical, especially as supply alleviated over the weekend could return when traditional markets open.
“No Man’s Land”
Since Saturday, bitcoin has risen almost 10% from $57,600 to $63,000, closing last week in the green. The asset has surged above the 125-day range low of $60,200, which it broke through earlier this month after news of the German government’s massive BTC selling hit the market.
Market sentiment began to improve after reports that wallets linked to the German government were almost empty. However, the positive sentiment may not be sustained for long as the BTC the German authorities moved to trading desks and exchanges are yet to be sold.
While the supply from Germany appears to have been factored into bitcoin’s market price, Bitfinex analysts believe the end of selling pressure depends on how the involved trading desks execute their trades in the coming days.
Although the shift in sentiment underscores the market’s capacity to integrate new information and adjust expectations quickly, analysts think the market’s reaction over the first two trading days of the week cannot be overlooked for two reasons.
First, the low support level in the $60,200 range has now become a potential resistance line. Second, trading patterns over the past three months suggest that weekends are usually favorable for markets, especially on Saturdays when supply pressure seems to subside.
“We are now in no man’s land until we get clear resolution above or below this level,” the analysts said.
A News-Driven Environment
Besides the potential resistance level and three-month weekend trading pattern, the market is currently in a news-driven environment, where the prices of cryptocurrencies have been determined by news agendas rather than fundamentals.
Since selling pressure concerns are not yet completely obsolete due to upcoming Mt Gox creditor distributions, Bitfinex analysts expect such headlines to continue to have some impact on price movements. As such, the analysts urged investors to exercise caution in their trading strategies.
BlackRock’s IBIT led with $117.25 million in inflows on July 15, also being the most traded Bitcoin ETF.
The US spot Bitcoin ETFs recorded a daily net inflow of $301 million on July 15th. This extended their winning streak to seven consecutive days amidst a broader market recovery.
None of the ETFs recorded outflows for the day.
Bitcoin ETFs Rake in $16.11B in Net Inflows Since Jan
According to the data compiled by SoSoValue, BlackRock’s IBIT, the top spot Bitcoin ETF by net asset value, recorded the largest net inflows of the day at $117.25 million. IBIT was also the most actively traded Bitcoin ETF on Monday, with a volume of $1.24 billion. Ark Invest and 21Shares’ ARKB came in close behind with net inflows of $117.19 million.
Fidelity’s FBTC experienced net inflows of $36.15 million on Monday, while Bitwise’s BITB saw $15.24 million in inflows. VanEck’s HODL, Invesco and Galaxy Digital’s BTCO, and Franklin Templeton’s EZBC funds also recorded net inflows. Meanwhile, Grayscale’s GBTC and other ETFs, such as Valkyrie’s BRRR, WisdomTree’s BTCW, and Hashdex’s DEFI, registered no flows for the day.
A total of $2.26 billion was traded on Monday. The trading volume for these ETFs was less than in March when it exceeded $8 billion on some days. Meanwhile, these funds have collectively attracted $16.11 billion in net inflow since their January launch.
What’s Next For Bitcoin?
Earlier this month, bitcoin’s price decline was mainly due to fears of massive selling pressure from Mt. Gox and the German government’s BTC sales.
But the assassination attempt on pro-crypto former US President and presumptive Republican candidate Donald Trump at Saturday’s rally seemed to spark a recovery in the world’s largest digital asset, and experts are bullish on the asset’s price trajectory going forward. Bitcoin surged more than 9% over the past week and was currently trading slightly below $64,000.
Veteran trader Peter Brandt discussed bitcoin’s price outlook, suggesting a potential major rally. He referred to a pattern he terms “Hump->Slump->Bump->Dump->Pump” and highlighted that the July 5 double top attempt was a bear trap, confirmed by the July 13 close. He sees a likely continued upward trend but warned that a close below $56,000 would negate this bullish view.
“Bitcoin $BTC could be unfolding its often-repeated Hump…Slump…Bump…Dump…Pump chart construction. Jul 5 attempt at the double top was a bear trap, confirmed by Jul 13 close. Most likely scenario now is that bears are trapped. Close below $56k negates this interpretation”
PeckShield alert reveals LI.FI’s protocol vulnerability is similar to a March 2022 attack, with the same bug recurring.
The decentralized finance (DeFi) platform LI.FI protocol has suffered an exploit amounting to over $8 million.
Cyvers Alerts reported detecting suspicious transactions within the LI.FI cross-chain transaction aggregator.
LI.FI Issues Warning After $8 Million Exploit
LI.FI confirmed the breach in a statement on July 16 via X: “Please do not interact with any http://LI.FI powered applications for now! We’re investigating a potential exploit.” The team clarified that users who did not set infinite approval are not at risk, emphasizing that only those who manually set infinite approvals seem to be affected.
According to Cyvers Alerts, more than $8 million in user funds have been stolen, with the majority being stablecoins. According to on-chain data, the hacker’s wallet holds 1,715 Ether (ETH) valued at $5.8 million and USDC, USDT, and DAI stablecoins.
Cyvers Alerts advised users to revoke relevant authorizations immediately, noting that the attacker is actively converting USDC and USDT into ETH.
Crypto security firm Decurity provided insights into the exploit, stating that it involves the LI.FI bridge. “The root cause is a possibility of an arbitrary call with user-controlled data via depositToGasZipERC20() in GasZipFacet, which was deployed 5 days ago,” Decurity explained on X.
“In general, the risks behind routers, cross-chain swaps, etc. are about token approvals. Raw native assets like (unwrapped) ETH are safe from these kinds of hacks b/c they don’t have approvals as an option. Most users & wallets also no longer do “infinite approvals” which gives a smart contract total control on removing any amount of their tokens. It’s important to understand which tokens you’re approving to which contracts.
This dashboard looks for all transactions of a user that intersects Lifi. Not all of these transactions indicate risk- but you can see how, broadly, integrations & layers of tech (like how Metamask bridge uses Lifi on BSC) can complicate how users do or don’t put their assets at risk. Revoke Cash is the most well known approval manager app.
But it’s also good security practice to simply rotate your address. New addresses start with 0 approvals, so starting fresh by moving your tokens to a fresh address is another good security practice.” – commented Carlos Mercado, Data Scientist at Flipside Crypto.
Recent Exploit Mirrors March 2022 Attack
Further analysis by PeckShield alert revealed that the vulnerability is similar to a previous attack on LI.FI’s protocol that occurred on March 20, 2022. That incident saw a bad actor exploit LI.FI’s smart contract, specifically the swapping feature, before bridging.
The attacker manipulated the system to call token contracts directly within their contract’s context, making users who had given infinite approval vulnerable. This exploit resulted in the theft of approximately 205 ETH from 29 wallets, affecting tokens such as USDC, MATIC, RPL, GNO, USDT, MVI, AUDIO, AAVE, JRT, and DAI.
“The bug is basically the same. Are we learning anything from the past lesson(s)?” PeckShield Alert said in a July 16 X post.
Following the 2022 incident, LI.FI disabled all swap methods in its smart contract and worked on developing a fix to prevent future vulnerabilities. However, the recurrence of a similar exploit raises concerns about the platform’s security measures and whether adequate steps were taken to address the vulnerabilities identified in the previous breach.
LI.FI is a liquidity aggregation protocol that allows users to trade across various blockchains, venues, and bridges.
