Speculation about a potential settlement between Ripple and the U.S. Securities and Exchange Commission (SEC) has resurfaced with the unlocking of 500 million XRP tokens, valued at approximately $297.74 million. This significant release has led to an 8% slump in XRP’s value, causing it to breach the $0.6 psychological support level.

The large unlock has intensified speculation regarding a possible settlement in the ongoing legal battle between Ripple and the SEC. The SEC is seeking a substantial $1 billion (plus interest) penalty from Ripple for alleged violations, while Ripple has indicated a willingness to settle for no more than $10 million.

Last week, pro-XRP attorney Bill Morgan described a potential Ripple SEC settlement as “unlikely.” However, he suggested that if a settlement does occur, it would be more of a compromise than a significant victory. Morgan emphasized that “settlements generally end matters in dispute, including appeal rights in the current proceedings.” He pointed out that Ripple might face challenges related to XRP sales beyond December 2020 and future XRP sales.

Former SEC lawyer Marc Fagel has also reinforced his stance that the SEC’s closed-door meetings are unrelated to the ongoing lawsuit. He predicted that a Ripple SEC settlement is unlikely as neither party appears willing to settle. Fagel also foresaw appeals from both sides after the ruling, indicating that the SEC’s exorbitant penalty might not be fulfilled, which could ease the pressure on Ripple.

Appeals and Remedies Ruling

The timing of the XRP unlock coincides with heightened anticipation around a ruling in the Ripple lawsuit's remedies phase. Initially expected on July 31, legal experts now predict the ruling may be delivered in August, possibly in the first half.

Wealth advisor Mickle and others consider the SEC’s case against Ripple to be weak, citing Ripple’s previous legal victories. Despite this, the possibility of both parties appealing earlier decisions remains, complicating the resolution of the case. Mickle also noted that the political climate, including a Democratic shift towards pro-crypto policies, might influence the likelihood of an appeal. He mentioned that Ripple is unlikely to appeal after the remedies phase ruling, especially considering the Kamala Harris campaign's attempts at a crypto reset.

Conversely, attorney Bill Morgan argued that if legal considerations alone guide the decision, appeals from both parties are likely. He clarified, “My point is merely that if legal considerations are the only basis for a decision to appeal, there is a good chance that the decision will be made to appeal.”

Morgan elaborated on potential legal strategies Ripple might adopt, suggesting that the firm could appeal based on distinctions between institutional sales and sales to On-Demand Liquidity (ODL) customers, given the fact-specific nature of the Howey test. He also explained the SEC’s rationale behind a potential appeal, noting that the SEC believes the Judge may have made an error, which is evident from its request for an interlocutory appeal.

Market Impact

The recent movements and legal speculations have contributed to market uncertainty for XRP. As the crypto community closely watches these developments, the outcome of the legal proceedings and the potential for appeals will likely play a crucial role in shaping XRP’s future market performance.

In conclusion, while the Ripple SEC settlement rumors and the substantial XRP unlock have stirred significant market activity, the ultimate resolution remains uncertain. Legal expert opinions and the impending remedies phase ruling will be critical in determining the next steps for both Ripple and the broader cryptocurrency market.

$XRP #XRP #Ripple

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