Ripple's XRP token corrected to $0.50 this Monday morning, losing all its gains over the past seven days. This drop comes as the XRP community questions the impact of the ETHgate controversy on the ongoing lawsuit between Ripple and the SEC.
XRP is losing ground
Ripple's token has undergone a sharp correction of over 20% over the past seven days, wiping out the progress made since April 22. This selling pressure coincides with the approach of a key stage in the legal battle against the American regulator, namely the imminent filing of an opposition brief from the SEC in response to Ripple's request.
Last March, the SEC introduced a new testimony expert in order to support its request for an injunction aimed at prohibiting Ripple from marketing XRP to institutional investors. This offensive has dampened the enthusiasm of XRP holders who are watching with concern the evolution of the procedures.
The Ripple vs. SEC case, the main catalyst for XRP price movements, enters a critical phase today with the SEC's highly anticipated response to Ripple's motion. A decision in favor of the regulator could increase the downward pressure on the altcoin in the short term.
The shadow of ETHgate hangs over the Ripple trial
At the same time, the controversial ETHgate theory is resurfacing on specialized social media. According to these allegations, the SEC deliberately favored Ethereum while targeting Ripple and its token XRP. Suspicions of a conflict of interest are crystallizing in particular around William Hinman, a former SEC executive with links to a legal firm involved with Ethereum.
This debate ignites the crypto community. If Charles Hoskinson, co-creator of Ethereum and founder of Cardano, categorically rejects these speculations which he considers “endless and unfounded”, David Schwartz, technological director of Ripple, questions him on a possible regulatory privilege granted to the 'ETH.
Oversold XRP, an opportunity for agile crypto traders?
From a technical analysis perspective, XRP is trading in oversold territory according to the Connors RSI leading indicator, offering attractive entry levels around $0.50. Opportunistic traders could therefore bet on a technical rebound towards $0.62, representing a potential appreciation of 22.5% in the short term.
However, the downward trend is likely to continue until a definitive outcome has been reached in the Ripple/SEC legal drama. The next few weeks promise to be crucial for XRP, whose trajectory remains suspended from the multiple twists and turns of this highly publicized trial.
In short, the Ripple trial and the ETHgate controversy keep XRP under pressure, despite short-term bullish technical potential. The crypto community will closely follow the SEC filing today, April 29, which could significantly influence the direction of the token in the coming days.
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