XRP surges 10% on speculation the CFTC's Binance suit could impact the token developer's monumental SEC case
- XRP is up 10% on Wednesday, trading at a five-month high.
- The surge comes on rumors surrounding the outcome of the SEC case against its developer Ripple.
XRP, the cryptocurrency issued by Ripple, is surging on rumors surrounding outcome of its long-running legal fight with the Securities and Exchange Commission.
The crypto is up 10% in the past 24 hours, according to Messari, trading at a five-month-high of $0.5. XRP has jumped 46% in the past month.
The price surge follows news involving another top financial regulator, the US Commodity Futures Trading Commission, which filed a lawsuit against crypto exchange Binance and its founder Changpeng Zhao for allegedly offering unregistered derivatives products to traders in the US.
"Rumors have been circulating recently that suggest XRP-issuer Ripple might win its lawsuit against the SEC, which alleges XRP was sold as an unlicensed security," Stanislav Havryliuk, COO of crypto exchange Zonda Global, told Insider. "Despite little concrete evidence to back up the rumours, some lawyers close to the case have publicly stated that they feel Ripple has an advantage - and a win would surely cause the price of XRP to surge."
Traders could see the classification of cryptos as a commodity in the filing to mean XRP tokens are as well, instead of a security which is what the SEC has stated. For context, the SEC sued Ripple back in 2020, alleging that the developer sold unregistered securities. A win against the agency would be a big victory for Ripple but also offer some further clarity on future regulatory treatment for many tokens.
Havryliuk added: "Even in the event of a loss, the price would probably suffer only briefly before recovering, so it's a low-risk bet with potentially high returns."
Crypto markets are up broadly this week. Bitcoin and ethereum are trading 6% and 4% higher, respectively, with the industry's total value hovering around $1.2 trillion.
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