Summary
- The SEC case has a clear timeline, but investors remain anxious.
- South East Asia will lead a revival as the market awaits the outcome of the SEC case.
XRP traded sideways today, shading 2.1% in the past 24 hours to sell at $0.4719 by the time of going to press. Ripple’s tug of war against the Securities and Exchange Commission (SEC) has put it in a precarious position, and it was way off its all-time high of $3.4.
However, at that price, it was still the seventh most-valuable crypto-asset, with a market capitalization of $21 billion and was up 112% year-to-date. It was also at a price 5.7% higher than 7 days ago.
Weathering the storm
Ripple has gotten a reprieve in its legal tussle with the SEC. Two days ago, the court allowed CEO Brad Garlinghouse and Executive Chairman Chris Larsen to file motions to dismiss. While that is not an outright win, it gives hope to investors that Ripple may soon get the case over and done with.
On the other hand, the SEC has also been granted the permission to go ahead and file a “motion to strike,” setting the stage for an anxious few weeks ahead for investors. The SEC has filed a response dismissing Ripple Labs’ “Due Process” and “Fair Notice,” defense standpoints as “improper.” The outcome of the case will certainly have a significant effect on XRP’s price.
Promising performance outside the United States
The turbulence in the United States notwithstanding, Ripple’s performance in other regions has been impressive. In Brazil, two firms providing low-cost payment solutions have teamed up to avail their services to SMEs in the country. MoneyNetInt and Banco Rendimento, both of which run on RippleNet, view Brazil as a big market that has not yet been adequately explored by payments companies. In addition to providing support to SMEs, the new partnership will provide cheap and instant money transfer services to individuals.
Elsewhere in Southeast Asia (SEA), Ripple’s growth trajectory has been exceptional. A recent blog post revealed that RippleNet’s transaction volume grew tenfold in 2020, with SEA contributing a significant percentage. For example, Siam Commercial Bank in Thailand reported more than half a million transactions, representing a 300% growth in inbound remittances for the year.
The SEA region also more than doubled the number of deals signed by Ripple year-on-year. This market segment could therefore stimulate an XRP price resurgence.
In the Philippines, iRemit, the largest non-bank remittance service provider in the country, has been integrated by BKK Forex. iRemit operates on RippleNet’s ODL. This could help propel XRP’s price higher.
Strategy and possible breakouts
RippleNet’s On-Demand Liquidity (ODL) solution has proven to be an invaluable asset in the payments segment. ODL facilitates the cross-border transfer of money using XRP as a bridge currency. This frees up capital held in NostroVostro accounts, thereby enhancing efficiency.
Ripple has signaled its intention to strengthen its presence in South East Asia with the appointment of Brooks Entwistle as the region’s Managing Director. Entwistle will lead the firm’s growth strategy in the region. He brings with him a wealth of experience, having previously served as Uber’s international Chief Business Officer, during which he spearheaded ventures into new markets.
Despite its struggles against the SEC, XRP’s outlook for the future looks promising. Word Bank Group and IMF’s Digital Advisory Unit have termed the Interledger concept as “very promising.” This follows joint research done by the two mega institutions on blockchain interoperability. The XRP Interledger Protocol was one of the three under review, with the other two being Ethereum and Polkadot.
Technical analysis
XRP will find support at $0.466 but will encounter the first resistance at $0.475. The second resistance level will be established at $0.492. A break beyond this point will drive the price to retest the $0.500 territory.
