XRPUSD Lawsuit by SEC, What does this mean?
Ripple, one of the world's most valuable cryptocurrency companies, on Monday disclosed that the SEC plans to sue the company, it's CEO and its executive chairman for allegedly selling unlicensed securities.
Ripple the company owns about 55B of the 100B circulating supply of XRP and would not pass the Howey Test. The Howey Test is a SEC case dating back all the way to 1946 where the Supreme Court ruled and created a test to determine whether an instrument qualifies as an "investment contract" for the purposes of the Securities Act: "a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party."
If you invest in XRP you're investing in the company Ripple and are expecting profits solely from the efforts of the company, XRP should be deemed a security in the US, it doesn't pass the Howey Test.
How are BTC and ETH not securities?
Bitcoin and Ethereum are both non-profit organizations that their cryptocurrencies aren't directly tied to a company or specific individual owners. BTC & ETH are also both hosted on their own decentralized blockchains where there isn't an owner and its open-source to the public.
XRP is the currency that runs on a digital payment platform called RippleNet, which is on top of a distributed ledger database called XRP Ledger. RippleNet is run by Ripple, while the XRP ledger is open-source but not hosted on a blockchain... but RippleNet. This means that Ripple is not a cryptocurrency by definition and will never be, it's a security.
The company has threatened to leave the United States due to a lack of regulatory clarity, but now they got their ruling! As a security! So if XRP is actually deemed as a security by the United States, you'll have to have a BD (Broker-Dealer) in order to trade the security. That is going to hurt the wallets of many American holders and the price may see an even sharper decline. You know how hard it is to get a BD? You need to get registered with FINRA and take your Series 7 & 66.
Technical Analysis of XRP
Usually I say news doesn't affect price and it doesn't. This is still pure technical analysis and at the moment XRP is holding $0.479 monthly support on the daily.
From here I can see a relief rally of buyers trying to push the price up back to the $0.51 - $0.53 range before falling down to $0.36 - $0.40. There is monthly support at that range as well as a decently-respected trendline placed around that area that should catch the price from falling lower.
I think before greatly moving forward, XRP is going to have to beat this case and drop down to $0.36 - $0.40. I would be beyond shocked if it just straight up reversed from these levels.
It's honestly unbelievable seeing the amount of delusion & ignorance to this SEC case, where long-term hodlers are seeing this as a shakeout of weakhands before the big pump... please tell me what company or crypto you know of besides Enron that got sued by the SEC for not only the company engaging in securities fraud, but the top two executives caught as well. Unbelievable. This is the trading competition though, they're making it too easy for me!!
I've been holding XRP since 2017 and I gotta say i've been through a lot mentally with this coin, but this case just tipped the boat. 🚣♀️ This case permanently damaged the coin's legitimacy and we're about to see another sell off going into this court case, the technicals are lining up for it.
Cheers everyone, the best is yet to come!
Ripple the company owns about 55B of the 100B circulating supply of XRP and would not pass the Howey Test. The Howey Test is a SEC case dating back all the way to 1946 where the Supreme Court ruled and created a test to determine whether an instrument qualifies as an "investment contract" for the purposes of the Securities Act: "a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party."
If you invest in XRP you're investing in the company Ripple and are expecting profits solely from the efforts of the company, XRP should be deemed a security in the US, it doesn't pass the Howey Test.
How are BTC and ETH not securities?
Bitcoin and Ethereum are both non-profit organizations that their cryptocurrencies aren't directly tied to a company or specific individual owners. BTC & ETH are also both hosted on their own decentralized blockchains where there isn't an owner and its open-source to the public.
XRP is the currency that runs on a digital payment platform called RippleNet, which is on top of a distributed ledger database called XRP Ledger. RippleNet is run by Ripple, while the XRP ledger is open-source but not hosted on a blockchain... but RippleNet. This means that Ripple is not a cryptocurrency by definition and will never be, it's a security.
The company has threatened to leave the United States due to a lack of regulatory clarity, but now they got their ruling! As a security! So if XRP is actually deemed as a security by the United States, you'll have to have a BD (Broker-Dealer) in order to trade the security. That is going to hurt the wallets of many American holders and the price may see an even sharper decline. You know how hard it is to get a BD? You need to get registered with FINRA and take your Series 7 & 66.
Technical Analysis of XRP
Usually I say news doesn't affect price and it doesn't. This is still pure technical analysis and at the moment XRP is holding $0.479 monthly support on the daily.
From here I can see a relief rally of buyers trying to push the price up back to the $0.51 - $0.53 range before falling down to $0.36 - $0.40. There is monthly support at that range as well as a decently-respected trendline placed around that area that should catch the price from falling lower.
I think before greatly moving forward, XRP is going to have to beat this case and drop down to $0.36 - $0.40. I would be beyond shocked if it just straight up reversed from these levels.
It's honestly unbelievable seeing the amount of delusion & ignorance to this SEC case, where long-term hodlers are seeing this as a shakeout of weakhands before the big pump... please tell me what company or crypto you know of besides Enron that got sued by the SEC for not only the company engaging in securities fraud, but the top two executives caught as well. Unbelievable. This is the trading competition though, they're making it too easy for me!!
I've been holding XRP since 2017 and I gotta say i've been through a lot mentally with this coin, but this case just tipped the boat. 🚣♀️ This case permanently damaged the coin's legitimacy and we're about to see another sell off going into this court case, the technicals are lining up for it.
Cheers everyone, the best is yet to come!
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