Long-awaited settlement in Ripple lawsuit against SEC is canceled; XRP price drops 9% ⋆ ZyCrypto

XRP, which has been at the center of a key legal battle for the crypto industry, fell today amid speculation that the U.S. Securities and Exchange Commission (SEC) had canceled a highly anticipated settlement with blockchain payments startup Ripple.

No settlement in sight

XRP has outperformed the cryptocurrency market in recent days, hitting a three-month high. The recent rally has been attributed to a closed-door SEC meeting scheduled on the agency’s website for July 18. Many investors expected there to be a conclusion to the long-running conflict with Ripple.

The Securities and Exchange Commission filed a lawsuit against Ripple in late 2020, claiming the company violated federal laws when it raised $1.3 billion by selling the token without registering it as a security.

The lawsuit is being closely watched because of its implications for the scope of the SEC’s jurisdiction. In what was seen as a huge loss for the regulator’s turf, a U.S. district judge ruled last July that sales of XRP to retail investors on exchanges did not constitute investment contracts.

The latest point of contention between Ripple and the SEC concerns the amount of damages for unregistered sales to institutional investors. While the SEC has sought a multi-million dollar fine against Ripple, the company maintains that the court should impose a civil penalty of no more than $10 million.

For this reason, the XRP army and members of the crypto community, in general, were eagerly awaiting the conclusion on the status of XRP tokens today, but the planned meeting was canceled.

The price of XRP has plummeted in response to the bad news, losing 8.8% of its value at the time of publication. The eighth-largest cryptocurrency was recently trading at $0.5666 after hitting $0.6355 just a day ago.

Pro-XRP attorney Fred Rispoli has previously commented on the possibility of Ripple and the SEC reaching a settlement before the court’s decision, noting that a pre-trial settlement is unlikely at this point, though the two sides could negotiate on unresolved arguments. Judge Analisa Torres is expected to issue her decision on the appeals soon, with Rispoli predicting that could happen by the end of this month.