XRP Price Drops After Judge Rejects Ripple, SEC Deal — Q3 Breakout Not Affected

Key Takeaways

• Optimism over a resolution between Ripple and the SEC faded after Judge Torres rejected the $50 million settlement.
• Yet, XRP’s MVRV Z-score of 2.13 indicates the token is undervalued, suggesting a potential breakout soon.
• Whale-to-exchange transactions dropped from 15,000 to just over 3,000 as the technical outlook remains bullish.

XRP price could be at risk of falling below $2 after Judge Analisa Torres rejected the proposed settlement between Ripple and the U.S. SEC.

Before the joint motion, optimism had been building across the market that the five-year legal battle was nearing its end.

However, the court’s decision to decline the agreement has reignited uncertainty, casting doubt over XRP’s short-term outlook.

In this analysis, CCN breaks down the implications of the recent ruling and what it could mean for XRP’s performance heading into the third quarter (Q3).

Ripple, SEC Setback Shakes XRP

On June 12, Ripple and the SEC jointly filed for an indicative ruling. This suggested that both parties were willing to settle and put their legal defenses aside.

However, Judge Analisa Torres rejected the proposed settlement, stating that the parties do not have the authority to bypass or disregard a court judgment, regardless of any private agreement between them.

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CCN recently reported how the parties agreed to reduce the settlement from $125 million to $50 million. However, in the judge’s view, a settlement must still be based on the rule of law and judicial oversight, not merely mutual consent.

“The parties do not have the authority to agree not to be bound by a court’s final judgment that a party violated an Act of Congress in such a manner that a permanent injunction and a civil penalty were necessary to prevent the party from violating the law again,” She stated in her ruling.

Following this development, XRP’s price fell to $2.10 amid rising market sell-offs. This drop means that the altcoin has now been 10% down in the past 30 days.

Despite that, on-chain analysis suggests that XRP’s price remains undervalued.

XRP Metric Moves Toward Turning Point

First, CCN examines the Market Value to Realized Value (MVRV)  Z-score. Like the MVRV ratio, this metric shows if a cryptocurrency has reached the market top (red zone) or is close to the bottom (green area).

According to Glassnode, XRP’s MVRV Z-score stands at 2.13. Historically, the altcoin reaches overvaluation when the metric is between 3.45 and 6.72.

For example, when XRP’s price was $3.25 in January, the Z-score was 6.65. At this point, XRP failed to breach the overhead resistance and eventually succumbed to a correction.

Fast-forward to a brief recovery in March, and a similar thing happened, which later led to the consolidation it has recently experienced. Therefore, the current MVRV Z-score shows the cryptocurrency is undervalued relative to the current market conditions.

As long as accumulation might begin to increase, XRP’s price is likely to break higher in the coming months.

Whales Reduce Sell-Offs for Maximum Impact

To further support the bullish thesis, CCN examined Whale-to-Exchange Transactions, a key indicator of large-holder behavior. Previously, CCN reported that XRP whales were driving the price lower.

However, according to the latest data from CryptoQuant, Whale-to-Exchange Transactions have now dropped to 3,075. Two days ago, over 15,000 such transactions reflected intense selling pressure.

This sudden decline suggests that large stakeholders are now refraining from selling, potentially opting to hold their positions.

If this trend continues, it could provide critical support for XRP’s price, helping to hold above $2 and potentially move toward $3 and beyond.

While it is unclear why whales have changed their stance, the chance of a Fed rate cut between July and September seems to drive this bias.

Lower interest rates could drive capital into risk assets if this happens, boosting XRP’s price.

Some analysts echo this optimistic outlook. For instance, crypto analyst and YouTuber Zach Rector believes that XRP has completed its wave 2 correction, referencing the Elliott Wave Theory.

According to Rector, wave 3 may be next, noting that this could be the most explosive XRP price phase in the Elliott Wave sequence.

CCN also spoke with Shawn Young, Chief Analyst at MEXC Research, about XRP’s price potential in Q3.

According to Young, institutional confidence in XRP and its expanding real-world utility could help the altcoin avoid a total breakdown.

He further emphasized that potential approval of XRP-based ETFs and increased capital inflows could provide the momentum needed for XRP to break the $2.65 resistance.

“Technically, the $2.17 – $2.20 range is now a key accumulation zone with upside movement contingent on XRP’s ability to reclaim the $2.40 zone and decisively break above the $2.65 resistance range. Bullish Fibonacci projections also further suggest that XRP may be entering its strongest rally phase yet. Should price break and hold above $2.65, XRP could move towards $3.40 in Q3,” Young told CCN.

XRP Price Analysis: No Deal, No Problem

From a technical standpoint, the daily chart shows a strong alignment of indicators pointing toward an impending breakout. Zooming into the image below, we observed that the Chaikin Money Flow (CMF) has climbed beyond the zero signal line.

It is also on the verge of breaking above the upper trendline of a falling wedge.

The rise in the CMF rating indicates increasing buying pressure. If sustained, this could drive XRP’s price beyond the overhead resistance at $2.25.

The Moving Average Convergence Divergence (MACD) also shows a positive reading and bullish crossover. If this trend remains unchanged, bulls might push XRP beyond $2.69 at the 0.236 Fibonacci level.

Once validated, XRP’s price could retest its yearly high of $3.40 before the next quarter ends, and the altcoin could also hit a new all-time high in the process.

On the contrary, if demand for the cryptocurrency fades, and whales send more coins to exchanges, this forecast might not happen.

In that scenario, XRP might decline toward $1.54 at the 0.618 Fibonacci retracement level.

Meanwhile, Ripple’s Chief Legal Officer, Stuart Alderoty, stated that the proposed settlement was not a bad outcome for the case.

“With this, the ball is back in our court. The Court gave us two options: dismiss our appeal challenging the finding on historic institutional sales, or press forward with the appeal. Stay tuned. Either way, XRP’s legal status as not a security remains unchanged,” Alderoty wrote on X.