XRP Surges To Highest Since November As Optimism Surrounding Ripple Case Grows

XRP prices rallied sharply today, climbing to a four-month high as the digital asset benefits from optimistic sentiment.

The cryptocurrency, one of the largest by total market capitalization, reached $0.4794 this afternoon, CoinDesk data shows.

At this point, it had risen more than 20% in less than 24 hours, and was trading at its highest since early November, additional CoinDesk figures reveal.

When explaining these latest gains, analysts pointed to bullish investor sentiment surrounding Ripple’s highly visible legal battle with the The U.S. Securities and Exchange Commission (SEC).

Ripple Lawsuit

In December 2020, the SEC claimed that Ripple Labs Inc., along with CEO Bradley Garlinghouse and Christian Larsen, who is the company’s cofounder, CEO and executive chairman, had raised over $1.3 billion by selling unregistered securities.

“The complaint alleges that Ripple raised funds, beginning in 2013, through the sale of digital assets known as XRP in an unregistered securities offering to investors in the U.S. and worldwide,” the SEC said in a statement.

“Ripple also allegedly distributed billions of XRP in exchange for non-cash consideration, such as labor and market-making services,” it added.

“According to the complaint, in addition to structuring and promoting the XRP sales used to finance the company’s business, Larsen and Garlinghouse also effected personal unregistered sales of XRP totaling approximately $600 million,” the regulator claimed.

The day before the SEC published the aforementioned statement, Ripple told Fortune that a lawsuit was imminent.

Further, Garlinghouse struck a combative note on Twitter. “Make no mistake, we are ready to fight and win – this battle is just beginning,” he stated on the social media platform.

Ongoing Lawsuit Developments

More recently, ongoing developments in the case, including a Letter Notice of Supplemental Authority filed yesterday, have made investors more confident about the outcome of the case, several analysts claimed.

By filing this letter, the defendants in the Ripple case sought to support their fair notice defense by referencing a separate legal case where Judge Michael E. Wiles, of the U.S. Bankruptcy Court for the Southern District of New York, rejected an SEC argument, ruling that it was too vague.

The government agency had objected to the desire of Binance.US to purchase the assets of bankrupt crypto company Voyager Digital, which included a digital asset known as VGX. The SEC had claimed that Voyager Digital was an unregistered securities exchange and that VGX had “aspects of a security,” without providing an explanation for either of the aforementioned claims.

“I reject the contention that the Court, and the Debtors, somehow were supposed to figure out for themselves just what ‘aspects’ of the VGX token might be considered to be aspects of a ‘security,’ or just what particular activities of Binance.US allegedly could raise registration issues, and then somehow to offer evidence and legal argument on those points,” Wiles stated.

Several analysts commented on the case, noting how the ongoing developments had impacted the price of XRP.

Marouane Garcon, cofounder of cross-chain decentralized exchange WhaleSwap, weighed in.

“New stories are coming out everyday it seems and the mood of these articles are increasing the sentiment among tokenholders,” he said via input sent through a LinkedIn direct message.

When asked about the recent price gains, Garcon provided the following response:

“Sure, there’s been tons of rumors that the SEC case will be settled in favor of XRP. That’s mostly what’s behind the price jump.”

“The rumblings are getting louder by the day,” he stated. “Tokenholders and Ripple execs are obviously confident about the outcome.”

Independent crypto analyst Armando Aguilar also weighed in.

“The New York court is set to rule on the case against XRP in the coming days,” he stated via emailed comments.

“Market participants are bullish/optimistic on the ruling of the case and we have witnessed major purchasing volumes across DEXs and CEXs, thus pushing the price higher.”

Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether, EOS and sol.