Positive Ripple Effect from the Ripple-SEC Ruling
Bitcoin and other cryptocurrencies took an upward turn on Friday, following a partial victory for the digital asset industry in a keenly observed legal battle between Ripple, the issuer of the XRP token, and the U.S. Securities and Exchange Commission. The Bitcoin price saw a 2% rise over the previous 24 hours to reach $31,200, surpassing a trading range that has stuck between $30,000 and $31,000 for several weeks, and hitting a new 13-month high above $31,750.
The catalyst behind this surge was a federal court decision on Thursday that stated a crypto token didn’t inherently qualify as a security. Even though there’s minimal argument about Bitcoin being a security – the consensus leans more towards it being a commodity – the ruling carries significant consequences for smaller tokens and the digital asset industry as a whole. This success can further uplift the largest crypto.
As Antoni Trenchev, the managing partner at crypto lender Nexo noted, “Bitcoin itself will rise on the coattails of this ruling – a rising tide lifts all boats – and briefly broke through the upper end of its recent trading range, where it’s been residing for three weeks.” He advised market watchers to keep a close eye on the $32,000 mark, as any breakthrough could invite the upper $30,000s.
Continued Rally Amid Signs of Cooling Inflation
This recent rally adds to the gains Bitcoin had made earlier in the week, with cryptos rising alongside traditional indices like the Dow Jones Industrial Average and S&P 500 amid signs of subsiding inflation. This trend could potentially nudge the Federal Reserve towards a less aggressive stance on interest rates. The dramatic rate increase of the past year had posed a challenge for cryptos, but the anticipation of rate cuts next year would likely favor risk-sensitive assets like stocks and cryptocurrencies.
Altcoins Follow Suit
In addition to Bitcoin, Ether, the second-largest crypto, jumped 6% to hover just under the $2,000 mark. Ripple, the token central to the court ruling, witnessed an almost 70% spike, and other smaller tokens or “altcoins” followed in its footsteps with substantial gains. “Memecoins” also gained strength, with Dogecoin up 7% and Shiba Inu increasing by 5%.
