If there’s anything that casual observers can take home regarding the legal drama surrounding the controversial cryptocurrency XRP (XRP-USD), it’s that you can never truly feel comfortable in the courtroom. While Ripple Labs — the originator of the coin in question — had many reasons to feel optimistic, the currents of justice can shift in unexpected ways, stealing frustration from the most buoyant of developments.
Indeed, it was only a few weeks ago that Ripple CEO Brad Garlinghouse declared that the fight against the Securities and Exchange Commission has gone “exceedingly well,” according to a CNBC report. Though the regulatory agency accused Ripple of using XRP as an unregistered security, the company has consistently argued that the underlying coin should be treated as a legitimate cryptocurrency.
Prior to Garlinghouse’s confident statement, “a judge ruled the SEC cannot edit the contents of emails purporting to show there were conflicts of interest regarding how the watchdog dealt with XRP and other tokens.” Slowly but surely, Ripple was poking holes in the SEC’s case, which seemingly augured well for XRP, a crypto coin that has suffered a substantial loss of trading volume due to the lawsuit.
But just as XRP investors were ready to rejoice, Ripple got hit with an unfavorable news item: the lawsuit has been delayed until 2023. Like a boxer sensing weakness in the opposition, getting saved by the bell is a benefit to the fighter that would have otherwise lost the match. Presumably, the SEC has more time to collect itself after absorbing critical legal setbacks.
Not surprisingly, on the afternoon of April 30, XRP was the hardest hit crypto on a trailing-week basis. Though I’d like to think — being a stakeholder myself — that the so-called Ripple coin can brush off this disappointment, it must also contend with an overall bearish environment in the capital markets. Those who are not speculators at heart should avoid playing games with XRP.
On the date of publication, Josh Enomoto held a long position in XRP. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.