Highlights:
- XRP price rose 27% after SEC Chair Gensler announced his resignation.
- Gensler’s departure may lead to fewer SEC lawsuits and more favorable regulation.
- XRP’s price could rise further with spot ETF approval and regulatory shifts.
Ripple’s XRP token rose 27% on Friday to $1.4 as the United States Securities and Exchange Commission (SEC) Chair Gary Gensler announced his resignation. Gensler’s exit may lead the agency to reassess its approach to ongoing litigation. This could result in a decision to drop its appeal in the SEC vs. Ripple lawsuit. Crypto has surged over 163% in the past 30 days after trading around $0.5 for most of the last two years. Its price nearly doubled this week, pushing the market cap to $63.59 billion.
Advertisement
SEC Chair Gary Gensler to Resign in January
Gary Gensler is stepping down after leading efforts to regulate the crypto industry. He plans to leave on January 20, 2025, according to a statement from the agency on Thursday. He described it as an “honor of a lifetime” to work with his agency colleagues.
Gensler, at the SEC since April 2021, pushed for central clearing in Treasury markets, changed executive pay rules, and worked to protect crypto investors. However, Gensler became a controversial figure in the crypto industry. His enforcement actions targeted major players like Ripple, Coinbase, Binance, and Kraken, earning him the title of a villain among some in the space.
The agency stated:
“In the last full fiscal year, according to the SEC’s Office of the Inspector General, 18 percent of the SEC’s tips, complaints, and referrals were crypto-related, despite the crypto markets comprising less than 1 percent of the U.S. capital markets.”
Katrina Paglia, Pantera’s legal head, anticipates fewer actions and possible dismissals following Gensler’s departure. SEC lawsuits against crypto companies are likely to decrease or settle without major admissions of guilt.
Crypto Market Surge and Regulatory Optimism Under Trump
Bitcoin’s price surged after the announcement, nearing $100k, driven by growing optimism among crypto investors. They anticipate that Trump’s administration will foster a more favorable regulatory environment for cryptocurrencies.
Cryptocurrencies like SOL and XRP, awaiting ETF approvals, are poised to benefit from this regulatory shift. Trump has expressed intentions to nominate an SEC chair who backs cryptocurrencies. The aim is to implement policies that foster growth in the crypto industry.
SEC Lawsuit Against Ripple
In December 2020, the SEC sued Ripple Labs, accusing it of conducting an unregistered securities offering by selling XRP. The SEC classified XRP as a security. In July 2023, a U.S. court ruled that XRP sales to institutional investors were securities transactions. However, sales on public exchanges were not considered securities. In October, the SEC appealed the court’s decision. The agency seeks more clarity on XRP’s legal status.
XRP Targets $2, Says Ali Martinez
The founders of LondonCryptoClub stated that XRP’s surge is driven by expectations of more favorable regulation under President-elect Donald Trump’s administration. The price surge above $1 aligns with the bullish positioning seen in the options market earlier this week. Coinalyze data shows that futures open interest reached a record $1.53 billion. A rise in open interest and a price rally confirms the uptrend.
Crypto analyst Ali Martinez predicts XRP is aiming for the $2 mark. He sees Gensler’s departure from the SEC as “the best thing that could happen to Ripple.”
‘@GaryGensler leaving the @SECGov is the best thing that could happen to @Ripple. Now, $XRP targets $2! https://t.co/YEDiZtrnB1 pic.twitter.com/LLE4n0MC8z
— Ali (@ali_charts) November 21, 2024
The approval of a spot XRP ETF in the US could drive XRP’s price higher. Bitwise and Canary Capital are awaiting SEC approval for their spot XRP ETFs, which are currently on hold due to legal disputes over XRP’s security status. Meanwhile, WisdomTree launched a physical XRP ETP in Europe, offering exposure to XRP’s spot price. This affordable product is fully backed by XRP and securely stored. The crypto community expects similar XRP ETFs to launch in the U.S. soon.
Advertisement
