In a significant development for the cryptocurrency market, XRP’s price declined 2.5% after a federal judge rejected Ripple’s proposed settlement with the SEC due to procedural issues. The ruling, which came on May 15, has created temporary uncertainty in the XRP market as it tests critical support at $2.35.
Settlement Motion Blocked on Technical Grounds
Judge Analisa Torres of the Southern District of New York rejected the joint motion from Ripple and the SEC, citing improper procedural filing under Rule 60. The proposed settlement aimed to reduce Ripple’s fine from $125 million to $50 million and dissolve an existing injunction. However, the motion failed to demonstrate the “exceptional circumstances” required under Rule 60 for modifying a final order.
Market Impact and Technical Analysis
The news triggered immediate market reaction, with XRP experiencing a 2.5% price decline. Key metrics from CoinGlass show:
- Open interest dropped 9% to $4.90 billion
- Long positions worth $21 million were liquidated
- Critical support level established at $2.35
Previous Legal Victories Remain Intact
Stuart Alderoty, Ripple’s chief legal officer, emphasized that the ruling doesn’t affect Ripple’s previous victories, including the landmark 2023 decision that XRP isn’t a security in programmatic sales. The current setback relates purely to procedural matters regarding the cross-appeal dismissal.
Next Steps in the Legal Process
Both parties must now:
- Prepare new documentation under Rule 60 guidelines
- Demonstrate exceptional circumstances for modification
- Submit revised settlement terms
FAQ Section
How does this ruling affect XRP’s legal status?
The ruling doesn’t impact XRP’s previous legal victories or its classification as a non-security in programmatic sales.
When can we expect a new settlement proposal?
Legal experts suggest the new Rule 60 motion could extend the settlement timeline into late summer 2025.
What are the key price levels to watch?
The critical support level at $2.35 remains crucial for short-term price action, with potential for further downside if breached.
Featured image: Ripple Labs Headquarters / Source: Bankless Times