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After making a comeback above $0.50 yesterday, XRP noted a mild decline from the level in the past 12 hours or so.
The brief uptrend, however, wiped its weekly losses, making XRP the only top cryptocurrency in the green during the same period, with a slight rise.
Investors Flock to XRP
In line with the price action, XRP saw a surge in open interest (OI) as traders continued to closely monitor the ongoing legal battle between Ripple and the US Securities and Exchange Commission (SEC).
This surge in OI suggests that investors are increasingly opening positions anticipating a rise in XRP’s price, according to CryptoQuant’s latest analysis.
The on-chain analytic platform further observed the heightened trading activity around XRP, which is currently the seventh-largest cryptocurrency by market cap.
While this trend could be indicative of bullish investor sentiment, it could also pave the way for potential volatility in the market.
“In such a scenario, it is crucial to monitor market volatility closely and prioritize risk management. As open interest increases along with the price, this could reflect investor expectations and actions, but it could also bring about sudden market fluctuations, so caution is necessary.”
Ripple And SEC’s Squabbles
The dispute between Ripple and SEC began in December 2020 when the latter accused the blockchain firm and a few of its execs of conducting an unregistered securities offering through XRP sales.
Last year, US District Judge Analisa Torres ruled that the San Francisco-based firm’s automated, open markets sales of the cryptocurrency were not considered securities offerings, which contradicted the SEC’s allegations. But the judge agreed with the agency’s assertion that Ripple’s direct XRP sales to institutional investors were indeed securities offerings.
The latest legal spat centers around the argument over the size of Ripple’s potential penalty. Initially, the SEC sought a $2 billion fine, while Ripple’s lawyers suggested that the civil penalty should not exceed $10 million, comparing it to the recent settlement of Terraform Labs.
The regulatory watchdog then countered Ripple’s proposal with a $102.6 million figure, significantly lower than the originally requested fine.
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