The new year brings renewed hope for XRP as analysts predict a significant rally if Ripple achieves a positive outcome in its ongoing legal battle with the U.S. Securities and Exchange Commission (SEC).
The long-running lawsuit, launched by the SEC in December 2020, accused Ripple of violating securities laws through the sale of XRP to institutional investors. Judge Analisa Torres ruled last year that XRP was not a security, but the SEC appealed the decision, leaving the case in limbo.
Carlos Guzman, research analyst at GSR, said a positive ruling could act as a major catalyst for XRP’s price. “If the SEC appeal is denied or the new SEC administration opts for a settlement instead, that would be a big win for Ripple,” Guzman said.
The cryptocurrency industry is pinning its hopes on President-elect Donald Trump’s incoming administration for regulatory relief. Trump, who takes office on Jan. 20, has signaled a pro-crypto stance by nominating crypto ally Paul Atkins to chair the SEC. Many believe this could lead to a more favorable regulatory environment for Ripple and other digital assets.
“If the new SEC leadership opts for a compromise, it could send XRP soaring,” Guzman added.
A positive regulatory outcome for Ripple could position XRP among a select group of digital assets eligible for exchange-traded funds (ETFs). Bloomberg ETF expert Eric Balchunas predicts a surge in new crypto ETFs under new management, citing the record success of spot Bitcoin ETFs as a benchmark.
“XRP should be among the first to receive approval,” Balchunas said, but warned that even with a positive regulatory outcome, crypto ETFs still face lengthy approval processes.
Beyond its legal challenges, Ripple is looking toward a promising future with the growing adoption of its new stablecoin, RLUSD. The company aims to strengthen its narrative as a legitimate payment solution, which Guzman believes could further strengthen XRP’s position.
Additionally, the resurgence of retail interest during the recent crypto rally has reignited investor enthusiasm for XRP. “Given the resurgence of retail interest in XRP that we saw in November and December, these positive developments could catalyze another wave of investor interest,” Guzman said.
*This is not investment advice.