XRP Open Interest Spikes in Response to Ripple-SEC Developments

After returning above $0.50 yesterday, XRP saw a slight decline from the level in the last 12 hours or so.

The brief uptrend, however, erased its weekly losses, making XRP the only cryptocurrency higher than the greenback during the same period, with a slight increase.

Investors flock to XRP

In line with the price action, XRP saw a rise in open interest (OI) as traders continued to closely monitor the ongoing legal battle between Ripple and the Securities and Exchange Commission (SEC). of the USA.

According to the latest CryptoQuant analysis, this increase in OI suggests that investors are increasingly opening positions in anticipation of an increase in the price of XRP.

The on-chain analytics platform further noted increased trading activity around XRP, which is currently the seventh largest cryptocurrency by market capitalization.

While this trend could be indicative of bullish investor sentiment, it could also pave the way for potential volatility in the market.

“In this scenario, it is crucial to closely monitor market volatility and prioritize risk management. As open interest increases along with the price, this could reflect investor expectations and actions, but it could also lead to fluctuations sudden changes in the market, so you have to be careful.”

Ripple and the SEC fights

The dispute between Ripple and the SEC began in December 2020 when the latter accused the blockchain company and some of its executives of conducting an unregistered securities offering through XRP sales.

Last year, U.S. District Judge Analisa Torres ruled that the San Francisco-based company’s automated and open sales of the cryptocurrency did not constitute securities offerings, contradicting al· legations of the SEC. But the judge agreed with the agency’s contention that Ripple’s direct sales of XRP to institutional investors were actually securities offerings.

The latest legal dispute centers on the argument over the size of Ripple’s potential penalty. The SEC initially sought a $2 billion fine, while Ripple’s lawyers suggested the civil penalty should not exceed $10 million, compared to the recent Terraform Labs settlement.

The regulatory body countered Ripple’s proposal with a figure of $102.6 million, significantly less than the fine originally requested.

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