![]() It is supported by this graph that the decline in the XRP price is carried out by the whales who made sales due to the unfavorable conditions brought by the lawsuit. The chart above clearly shows the decrease in the number of wallets with a minimum of 1 million XRP in their wallets after the lawsuit. that do not wish to oppose SEC have either cancelled their XRP transactions entirely or suspended them.Īfter these actions, there is a serious decrease in XRP price. SEC’s making such a distinction raises question marks in terms of the public.Īfter the lawsuit was filed, almost all cryptocurrency exchanges (Coinbase, Binance US, etc.) and XRP-accepting asset management companies (Genesis, Grayscale, etc.) operating in the U.S. Because XRP is classified similarly to Bitcoin and Ethereum in many countries outside of the USA. Another point that reinforces Ripple’s trump is the SEC’s comment that Bitcoin and Ethereum are not securities. While this proves the SEC is aware of XRP and receives a search request, it is presented as a strong evidence that the SEC did not do its duty and is used by Ripple as an argument that this lawsuit is filed for political reasons. The Ripple company’s strongest argument is that in 2019, an unnamed US-based cryptocurrency exchange asked from SEC for its observation before listing XRP, however SEC suggesting to do their own research without commenting on the XRP’s situation. After all, if Ripple marketed XRP as an investment tool that is expected to be valued in the future, XRP can be considered an investment contract and result in SEC being justified. The way XRP is marketed to investors who bought XRP between 20 and the investors’ motivation when purchasing XRP is significant since the SEC supports or does not support the mainstay in the lawsuit. The SEC’s lawsuit is based on Ripple’s direct marketing of XRP to investors without informing the SEC, as well as the fact that Ripple continues to sell XRP despite the lawyers’ warning in 2012 that Ripple may be categorized as a security. SEC, which defines XRP as a security, not a currency, claimed that Ripple sold 14.6 billion XRP between 20, generating $1.3 billion in unlawful profit, and Garlinghouse and Larsen earned $600 million from personal XRP sales. ![]() The SEC filed a lawsuit accusing Ripple and Ripple executives Garlinghouse and Larsen due to carrying out unregistered sales of XRP between 20. Despite the criticism, it can be argued that XRP serves its aim in this regard.Īs can be seen in the chart below, the price of XRP has risen remarkably since the beginning of March 2021, following successive court rulings in Ripple’s favour. The operation and methods of XRP can be questioned, however, the exact point is that XRP transfers money within seconds from the day it is established. Therefore, it can be said that an anti-XRP community has been formed, as well. Unlike decentralized cryptocurrencies that start with Bitcoin, XRP is often criticized for being completely under the control of Ripple. XRP is a digital asset that aims to make cross-border money transfers made by cryptocurrencies over the blockchain swiftly. In this essay, you will find brief commentary on the developments in the lawsuit from the very beginning to the very end and the effects of these developments.īefore moving on to the developments in the lawsuit, it will be useful to provide some background information about XRP. Ripple, Ripple executives Garlinghouse and Larsen, and Ripple investors are on the advocacy side of the lawsuit, while the SEC is the plaintiff. ![]() For this reason, we can say that innovations can be made in similar traditional methods after the lawsuit. With the advent of cryptocurrencies, it is apparent that many categorization applications, such as the one used by official bodies Howey Test, remain outdated. Hence, the lawsuit is significant for the categorization of not only XRP but also all cryptocurrencies care of XRP. ![]() The classification and regulation of cryptocurrencies in the United States, the world’s largest economy, could take a new turn because of the XRP lawsuit. financial regulator SEC, is seen as a candidate to be a turning point for the industry. The lawsuit involving Ripple company, which is the fourth largest cryptocurrency in terms of market size, is linked to XRP, and the U.S. Perhaps the most famous of such lawsuits in the cryptocurrency sector was the lawsuits concluded at the beginning of 2021 regarding whether Tether’s reserves are sufficient or not. The stories and results of these lawsuits are a turning point. Some lawsuits, on the other hand, impact a much larger audience or sector than just the parties involved.
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