XRP’s Plunge Sparks ETF Uncertainty Amid Regulatory Scrutiny

XRP took a major hit, plunging from its recent peak of 0.74 to $0.60. The cryptocurrency’s sustained downturn raised concerns among investors about potential factors driving the bearish trend, including regulatory uncertainties and selling pressure. As the market closely watches XRP’s performance, its future trajectory could significantly impact the broader narrative surrounding the digital asset.

U.S. lawmakers urge SEC to reject additional crypto ETFs

This week, U.S. lawmakers targeted Bitcoin (BTC) and the US BTC-spot ETF market. Fox Business journalist Eleanor Terrett shared a letter from lawmakers to SEC Chair Gary Gensler.

🚨NEW: Rhode Island Senator @SenJackReed and California Senator @Senlaphonza have penned a letter to @GaryGensler asking for the agency to step in to ensure broker-dealers are giving investors the proper disclosures around the $BTC ETFs (which they say should be properly referred… pic.twitter.com/xwlfu7kx3F

— Eleanor Terrett (@EleanorTerrett) March 14, 2024

Democrats Senators Jack Reed and Laphonza Butler pleaded with Gensler to limit the growth of the cryptocurrency-spot ETF market. “We think the SEC should strictly limit the precedential application of these approvals,” the statement reads. Though it has shown signs of severe weakening, the bitcoin market is significantly more developed and closely watched than any other cryptocurrency market. While Bitcoin is susceptible to manipulation and fraud, other cryptocurrency exchanges are even more open to wrongdoing.

The senators also discussed market surveillance. They stressed the importance of protecting regular investors from not actively traded cryptocurrencies and against pump-and-dump scams. The likelihood that the SEC will approve the ETH-spot ETF applications has recently increased. As for the XRP-spot ETF market, those, too, have disappeared. Investor hopes of accepting an XRP-spot ETF might be further impacted by the letter to Chair Gensler.

The SEC’s intentions to appeal the ruling on the Programmatic Sales of XRP would justify the inclination to reject altcoin ETF applications. In July 2023, Judge Analisa Torres ruled that programmatic sales of XRP do not satisfy the third prong of the Howey Test.

Spot ETF issuers are unlikely to submit XRP-spot ETF applications until the end of the appeals process. The ongoing SEC v Ripple case is in its final stages. Judge Torres could deliver a summer ruling on the Penalty for breaching Section 5 of the 1933 Securities Act. Crypto experts believe an appeal against the Programmatic Sales ruling could extend the case into 2025.

The SEC’s Appeal Process Is Uncertain for XRP-Spot ETF

Amidst the ongoing SEC vs. Coinbase legal dispute about oversight of cryptocurrency exchanges and possible conflicts of interest, investors are wary of an XRP-spot ETF market because of a recent court decision that casts doubt on the SEC’s appeal jurisdiction. A Republican-led administration may halt the SEC’s actions against Bitcoin firms. While investors wait to see what the SEC will do about the future of the XRP-ETF market, the CEO of Ripple is hoping for a Supreme Court hearing.

Currently, the price of XRP stands at $0.624641, accompanied by a 24-hour trading volume of $3.40 billion and a market capitalization of $34.23 billion. Over the past 24 hours, there has been a marginal increase of 0.02% in the price of XRP.

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