- The XRP legal supporter was skeptical about the hype around the email release.
- XRP’s circulation and Open Interest witnessed a significant drop.
William Hinman’s email release might have no real impact on the judgment of the case between Ripple Labs and the SEC, according to John .E. Deaton. The lawyer— a Ripple [XRP] enthusiast dropped the bombshell on Scott Melker’s “The Wolf of All Streets” podcast on 15 June.
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For a lawsuit that has been ongoing since 2020, the Hinman document has been mentioned as vital evidence if Ripple was to win the judgment. Needless to say, CEO Brad Garlighouse was also elated by the development.
Not yet time to toast
However, Deaton opined that the content of the document may match the hype when it comes to the final decisions by the judge. Deaton, who is also the founder of CryptoLaw said,
“When there’s something with the hype that much, it’s likely going to disappoint. There’s nothing in the speech that is going to affect the judge’s analysis of whether Ripple selling XRP was an investment contract.”
Surely, the outcome of the lawsuit will have significant implications not only for Ripple but also for the broader cryptocurrency industry. Victory would mean a possible provision for regulatory clarity and confidence in cryptocurrencies beyond XRP.
A loss, on the other hand, might propel market capitulation and trigger a wave of crypto firm exits from the United States.
While the ultimate decision remains uncertain, it could still affect the exact course of XRP’s price action. For instance, the Hinmam email public release last week led to a 7% hike in the token value. But this was short-lived.
XRP is in shaky hands
And at press time, XPR had lost 12.75% of its seven-day value. However, the seven-day circulation of XRP fell to 1.08 billion. This suggested that transactions by unique addresses decreased, suggesting a decline in interest.
Source: Santiment
Furthermore, XRP’s social dominance which went as high as 4.51% on 8 June, was down to 1.388%. This indicated a decline in the XRP hype since the share of discussion decreased.
Meanwhile, the happening in the derivatives market seems to have changed. According to Coinglass, XRP was one of the tokens with the highest futures contracts up until 7 June.
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But at the time of writing, the XRP Open Interest (OI) drastically decreased. Typically, the OI tracks the number of unsettled options or futures contracts. Since XRP’s Open Interest decreased, it means that a number of contracts were being closed.
Source: Coinglass
Hence, the token volatility may contract while triggering the possibility of a long or short squeeze. In a short squeeze, short sellers all exit at once. This could cause a sharp upward movement.
But in a long squeeze, the token price could fall as long buyers try to limit their losses.
