The case of Ripple is now four years old as it continues to be bombarded by litigation from the SEC, while Bitcoin breaks below $95k following the outflows from the ETF and hawkish policy stances from the Fed.
The largest news in the crypto world currently includes major events involving XRP and Bitcoin (BTC). Already four years into the litigation of the SEC against Ripple, the implications are deep for XRP and the rest of the crypto market. On the other hand, BTC fights to stay below the $95,000 mark amid continued ETF outflows fueled by hawkish Federal Reserve policies.
SEC vs Ripple Case Hits the Fourth Anniversary
This marks the fourth anniversary since the SEC filed its lawsuit against Ripple, co-founders Chris Larsen and Brad Garlinghouse. The case has been pretty stormy for XRP holders. XRP lost its position as the second largest cryptocurrency by market capitalization from December 2020 down to a low of $0.1009 in March 2020.
However, XRP staged a great comeback and reached an all-time high of $2.9070 in December 2024, motivated by hopes that the Ripple case is nearing its conclusion. The pro-crypto agenda under the potential re-election of Donald Trump also further buoyed the hopes for an end to the legal battle. Despite all this, the recent actions of the SEC imply that it might appeal further, and its opening brief is to be filed by January 15.
Is SEC Chairman Gensler going to appeal?
SEC Chairman Gary Gensler, a former deputy director of enforcement at the agency who has strengthened the agency’s enforcement division by placing experienced crypto litigators throughout its ranks, isn’t going anywhere until January 20, days shy of the deadline for the appeal and has filed the opening brief himself, some say, echoing the endgame of former chairman Jay Clayton.
But does the new SEC Chair, Paul Atkins, change the policy of the agency to enforcement on crypto? If the SEC goes through with the appeal, XRP will get highly volatile and the price may go below $1.50. If the SEC drops the appeal, XRP may explode going all the way up to its previous all-time high of $3.5505 back in January 2018.
Ripple Case: Legal Developments and Price Fluctuations
The uncertainty of the case is slowly being reflected in the XRP price action. It increased by 2.62% on Dec. 23, 2024, after declining 1.58% the trading day before. With all the recent hikes, a careful mood persists since investors await news of the SEC’s next move regarding the Ripple case.
Some recent decisions from the courts may lean in Ripple’s favor: there was a ruling made by Judge Analisa Torres stating that programmatic sales of XRP do not qualify under the third prong of the Howey Test. That’d be pretty significant for crypto companies, which have been selling these secondary digital assets. Legal analysts and former officials of the SEC believe that fresh leadership at the helm will change course that, in effect, would finish off the case.
BTC Struggles Below $95k: ETF Outflows Impacting Price
Bitcoin, however, is under pressure as it has to remain beneath the crucial level of $95k. Outflows from Bitcoin spot ETFs have been continuously damaging the BTC market, which has been exacerbated by the dovish monetary policy of the Federal Reserve. During this period until December 2024, Bitcoin has witnessed net outflows from US BTC-spot ETFs to the tune of $258.2 million. Fidelity’s Wise Origin Bitcoin Fund and Grayscale Bitcoin Trust, for instance, experienced severe redemptions.
This is the third week in succession that ETF has experienced outflows and as such, demand for Bitcoins has weakened further from its highs. However, MicroStrategy, led by Michael Saylor, continues collecting BTC; this time, it purchased more than 5,000 BTC worth around $561 million. This is going to be a move of confidence in Bitcoin’s long-run potential yet to be seen by the broader market.
BTC Price Forecast: Fed Impact Immense
Bitcoin’s near-term view is highly susceptible to the US macro picture, which is indeed going through quite a transformation. On December 23, BTC slid 0.50% after losing ground after having dropped 2.26% the day before. A couple of significant data series are keeping investors on high alert – US jobless claims are out later this week and might start painting a picture of where the Fed’s policy might be heading.
If labor market data is stronger than expected, fuelling the perception of further hawkish actions by the Fed, that will weigh on the spot BTC ETF market and further drag BTC down. On the other hand, an unexpected uptick in jobless claims may prompt a dovish outlook, possibly reigniting demand for Bitcoin and driving the price back toward $100k.
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Market Outlook: What Next for XRP and BTC?
XRP and Bitcoin are at a crossroads entering 2025. What the SEC does next will determine the outcome of the Ripple case, with extreme moves in the cryptocurrency through legal decisions. Meanwhile, Bitcoin’s future remains firmly tied to ETF flows and macroeconomic factors including Fed policy and the US labor market.
XRP and Bitcoin will be fashioned and propelled by regulatory measures, legal decisions, and other deeper market trends because the landscape of cryptocurrency will continue to change. So, to better navigate their path through market volatility, knowledgeable crypto investors will have to keep abreast with developments.
Conclusion: Ripple and BTC are reaching crucial turning points because, as the end of 2024 breaks through the horizon, regulatory dynamics married with market conditions shape their paths. The verdict of the appeal filed by the SEC on Ripple will determine not just XRP’s future, but will also set precedence for the entire cryptocurrency market. Meanwhile, Bitcoin continues to remain extremely sensitive to the inflows in the ETF and macroeconomic signals while attempting to regain stability above critical price levels. New leadership will usher in an ever-changing regulatory landscape that will be transformative in the regulation of digital assets in 2025 and beyond.
Also Read: Solana Price Struggles At $180 – Can A Rebound Be Expected?
