Ripple Faces ETF Uncertainty After Court Rejects SEC Motion
By Bob Mason | Updated: May 18, 2025
In a significant blow to Ripple Labs, the ongoing uncertainty surrounding the potential approval of an XRP exchange-traded fund (ETF) has intensified following a recent court ruling. The U.S. District Court, presided over by Judge Analisa Torres, rejected the U.S. Securities and Exchange Commission’s (SEC) request for a ruling that could have lifted an injunction against XRP sales to institutional investors. This ruling has sent XRP prices tumbling and raised concerns over the future of its ETF applications.
Market Reaction to Court Ruling
XRP, the cryptocurrency associated with Ripple Labs, experienced a notable decline in value following this court decision. On Saturday, May 17, XRP fell by 1.04%, closing at $2.3543, following an earlier high of $2.6507 on May 14. The price dipped to a low of $2.2994, highlighting the immediate fallout from the ruling. The market had high hopes for the court’s response, which ultimately crushed short-term momentum for XRP.
Judge Torres’ ruling specifically denied the SEC’s request to vacate the previous injunction and to reduce the related $125 million penalty. This outcome has compounded investor uncertainty, especially as they look ahead to the SEC’s forthcoming settlement filing, which will play a crucial role in determining the approval of XRP-spot ETF applications.
Implications for XRP and ETF Prospects
The market’s optimism is now contingent upon whether the SEC will acknowledge that XRP is a commodity rather than a security, a stance that would be significant following years of legal confrontation. Leading attorney John E. Deaton, who has been closely monitoring the case, remarked that a public admission of flaw in the SEC’s position could lead to a revival in demand for XRP.
"Such admissions would be critical not just for XRP but also for the broader cryptocurrency market," Deaton stated. Investors are keeping a close eye on upcoming deadlines for several XRP-spot ETF applications, with expectations that the SEC will likely push for a delay in their decision.
XRP’s Price Outlook
Despite the recent ruling, there are still optimistic forecasts regarding the possibility of XRP-spot ETF approval. According to market data from Polymarket, the likelihood of receiving an approval by December 2025 stands at 83%. This figure represents a noticeable rise from 68% earlier in April but a decrease from 87% observed in March.
For XRP, the immediate path forward appears closely tied to the developments in its legal battles and impending ETF news. Analysts suggest that if the SEC were to drop its appeal, XRP could potentially retarget its all-time high of $3.5505, with a successful ETF approval possibly pushing prices toward $5. Conversely, if the court rejects the SEC’s upcoming settlement attempt, the price could potentially retreat to as low as $1.50. ### Technical Analysis
From a technical perspective, XRP remains above critical support levels, specifically the 50-day and 200-day Exponential Moving Averages (EMA), indicating a degree of bullish momentum despite the recent four-day losing streak. If XRP manages to break above the $2.5 mark, it could pave the way for targeting the previous highs of $2.6553, and further testing the $3.00 level.
Broader Market Evaluations
In addition to legal developments, XRP’s performance is influenced by general market conditions. The cryptocurrency market remains sensitive to macroeconomic factors, including trade developments and recession risks, which can profoundly impact investors’ risk appetite.
As the landscape continues to evolve, regulatory clarity will remain a focal point for XRP and similar digital assets. Stakeholders are left to wonder whether the SEC will reassess its strategy, which could unlock a new bullish trend for the cryptocurrency.
In conclusion, Ripple’s future, and that of XRP, hangs in the balance as market participants await significant developments in the ongoing legal saga and decisions surrounding ETF applications.
For those tracking Ripple and the cryptocurrency scene, further updates will be pivotal in determining investor sentiment and potential market movements in the coming weeks.
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