The cryptocurrency market faced renewed turbulence this week as Ripple’s (XRP) ongoing legal saga intersected with fresh SEC delays on XRP-spot ETF approvals, while Bitcoin (BTC) struggled ahead of Fed Chair Jerome Powell’s Jackson Hole speech. 

Investor sentiment has been rattled, reflecting broader market fragility across digital assets. Daniel Morris, a ProDivia Group broker, shares an insightful and comprehensive breakdown.

XRP-Spot ETFs – Delays Drag Prices Lower

The Securities and Exchange Commission (SEC) announced delays in its decisions on multiple XRP-spot Exchange-Traded Funds (ETFs), signaling a cautious regulatory stance despite the pro-crypto policies initiated under the Trump Administration. Notably, the SEC postponed decisions on:

• Grayscale XRP Trust
• Canary XRP Trust
• CoinShares XRP Trust
• 21Shares Core XRP Trust
• Bitwise XRP ETF

The postponements extend the approval deadlines to October, quashing immediate hopes for a wave of spot XRP ETF launches following the Joint Stipulation of Dismissal filing on August 7. The market interpreted this as a temporary setback, but the delay may provide the SEC with the window to implement a standardized crypto ETF framework, potentially revolutionizing US crypto-spot ETF regulations. 

A robust framework could pave the way for mainstream adoption of crypto assets, enhancing market liquidity and institutional participation.

Despite these developments, the US Court of Appeals ruling remains pivotal. XRP-spot ETFs are unlikely to receive approval until the court formally accepts the SEC and Ripple appeal withdrawals, effectively ending the nearly five-year legal battle.

XRP Price Action and Outlook

Investor disappointment translated into notable price volatility for XRP. On Wednesday, August 20, XRP fell 8.8% to $2.8204 before briefly rebounding to $2.9578, ultimately closing at $2.8684 amid broader market weakness.

On Thursday, August 21, XRP slid 3.39%, reversing a 3.18% rally from the previous day, closing at $2.8529, underperforming the total cryptocurrency market, which declined 1.85% to a market cap of $3.76 trillion.

Key catalysts driving XRP price trends include:

• US Court of Appeals Ruling
• XRP-spot ETF developments
• XRP Treasury Reserve Asset adoption
• Ripple’s US-chartered bank license application
• SWIFT integration and competition
• Legislative developments, including the CLARITY Act

Bearish Scenario: Legislative setbacks, slow adoption as a Treasury Reserve Asset, denial of bank license, SWIFT dominance, or SEC disapproval of XRP-spot ETFs could drive XRP below its August 3 low of $2.7254, with $2.5 as a potential support.

Bullish Scenario: ETF approvals, bank license authorization, Treasury Reserve Asset adoption, bipartisan support for the CLARITY Act, or Ripple gaining market share from SWIFT could propel XRP above its all-time high of $3.6606, potentially targeting $5.

Bitcoin Faces Fed-Driven Pressure

While XRP reacted to ETF delays, Bitcoin (BTC) faced selling pressure ahead of Fed Chair Powell’s speech. Mixed US economic data, particularly labor market strength versus inflationary signals, heightened uncertainty over the Federal Reserve’s monetary policy path.

The FOMC Meeting Minutes highlighted concerns over tariffs, inflation, and labor market stability. Investors are weighing whether Powell will prioritize labor market support, which could imply rate cuts, or inflation containment, which would likely delay monetary easing.

Implications for Bitcoin:

• Hawkish Fed stance: Delays in rate cuts could elevate borrowing costs and strengthen the US dollar, reducing BTC’s attractiveness as a store of value.
• Dovish Fed stance: Rate cuts may reduce borrowing costs, weaken the US dollar, and increase demand for BTC and other risk assets.

US BTC-Spot ETF Flows Highlight Market Weakness

Investor anxiety over monetary policy has manifested in BTC-spot ETF outflows. On August 20, net outflows totaled $315.9 million, followed by $66.9 million on August 21 (excluding BlackRock iShares Bitcoin Trust [IBIT]). Notable ETF outflows included:

• Fidelity Wise Origin Bitcoin Fund (FBTC): $31.8 million
• ARK 21Shares Bitcoin ETF (ARKB): $43.3 million

IBIT alone recorded $220 million outflows on August 20, highlighting continued investor caution. These ETF flow trends are critical indicators for BTC’s supply-demand dynamics, directly influencing short-term price trajectories.

BTC Price Outlook

BTC closed at $112,464 on August 21, down 1.61%, partially reversing the prior day’s 1.27% gain. Future price movements will hinge on:

• Fed monetary policy signals from Powell
• US legislative developments impacting crypto markets
• BTC-spot ETF flows

Bearish Scenario: Legislative roadblocks, a hawkish Fed, and persistent ETF outflows could drive BTC to $110,000, testing the psychological $100,000 support.

Bullish Scenario: Bipartisan support for the CLARITY Act, dovish Fed commentary, and ETF inflows could push BTC toward its record high of $123,731.

Conclusion

The intersection of Ripple’s legal endgame, SEC ETF delays, and BTC macro pressure underscores the sensitivity of crypto markets to regulatory and monetary policy developments. XRP’s trajectory is tethered to court rulings and ETF approvals, while BTC remains responsive to Fed signals and ETF flows, setting the stage for a potentially volatile late summer in crypto markets.