XRP, a key digital currency in the crypto market, has spiked 26%, seemingly as a result of current developments in Ripple’s lawsuit with the U.S. Securities and Exchange Commission (SEC). Recent court proceedings suggest that Ripple’s legal battle might be reaching its conclusion, with no indications that XRP will be deemed a security.
The legal clash with SEC has been ongoing for almost three years. Recently, a New York federal judge has brought Ripple Labs closer to the resolution, commanding a $125 million civil penalty on the company. Ripple Labs are also prohibited indefinitely from violating U.S. securities laws. The company’s executives have lauded this ruling as an industry victory.
According to CoinMarketCap, Ripple’s XRP rallied to $0.63 in response to the legal update, recouping a large majority of the losses experienced due to the general crypto market slump since August 5. XRP’s current trade value sits at $0.59.
Ripple Labs CEO Brad Garlinghouse expressed relief and satisfaction at the ruling, stating it as a win for Ripple, the crypto Industry, and the rule of law. He also expressed hope for an end to what he termed the SEC’s unjustified war against crypto.
On the other hand, crypto industry commentators have been intently observing the spike in XRP’s price following the court ruling. They view the $125M penalty as a minimal setback, suggesting that Ripple might have easily recuperated the loss through the consequent rise in XRP’s price.
The sudden surge in XRP’s price has stunned future traders, obliterating 40% more short positions than long ones in a mere four hours. CoinGlass data indicates that short positions worth over $5.4 million were liquidated after this upward price movement. If the momentum continues and XRP’s price increases to $0.65, an additional $20 million in short positions could potentially be liquidated.