The price of XRP, the cryptocurrency associated with Ripple Labs, experienced a significant surge—rising by up to 86%—shortly after Ripple filed its formal response to the U.S. Securities and Exchange Commission's (SEC) $1.3 billion lawsuit. At the time of reporting, XRP was trading at approximately $0.47 per token, marking a 55.1% increase within 24 hours and a 73.5% rise over the past week.
Market Reaction and Speculation
Some analysts attributed this sudden price movement to a coordinated "pump" orchestrated by a Telegram group, capitalizing on low liquidity and high short interest due to the ongoing SEC litigation.
"XRP is being pumped by a pump-and-dump Telegram group and is up more than 50% in the last 45 minutes," noted crypto researcher Larry Cermak. "The setup was perfect—low float, few sellers, and many shorters."
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Ripple's Legal Defense
In its 93-page response, Ripple argued that the SEC’s lawsuit rests on an "unprecedented legal theory" and lacks jurisdiction over XRP, which functions as a medium of exchange rather than a security. Key points include:
- XRP’s Utility: Ripple emphasized XRP’s role in cross-border payments, distinguishing it from traditional securities.
- Regulatory Double Standards: The company filed a Freedom of Information Act (FOIA) request questioning why Ethereum’s ETH was not classified as a security despite similar origins.
"The SEC has no authority to regulate XRP as a security," Ripple’s legal team asserted.
SEC Allegations and Ripple’s Counterarguments
The SEC’s December 2020 complaint alleged that Ripple conducted an unregistered securities offering since 2013, raising $1.38 billion through XRP sales. It also accused executives Chris Larsen and Brad Garlinghouse of personally profiting by $600 million.
Ripple’s defense highlights:
- Decentralization Claims: Unlike Ethereum, which evolved into a decentralized network, Ripple maintains control over XRP.
- Historical Context: The SEC’s case ignores XRP’s established use in financial transactions.
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FAQ Section
Q: Why did XRP’s price spike suddenly?
A: The surge likely resulted from a mix of short squeezes and speculative trading, exacerbated by low liquidity.
Q: What is the SEC’s main argument against Ripple?
A: The SEC claims XRP is an unregistered security, citing Ripple’s control over its supply and distribution.
Q: How does Ripple’s defense compare to Ethereum’s case?
A: Ripple argues ETH received favorable treatment despite similarities, pointing to potential regulatory inconsistency.
Market Data (Snapshot)
- XRP Rank: #4 by market cap ($21.7 billion)
- 24h Trading Volume: $32.78 billion
- Price Change (24h): +46.62%
Data reflects conditions at the time of writing. For live updates, monitor trusted financial platforms.
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