In late December 2020, a securities lawsuit was filed against blockchain giant Ripple by the US Securities and Exchange Commission (SEC). The lawsuit seeks $1.3 billion in damages.
Tuncay YILDIRAN, Member of the Board of Directors of ICRYPEX, and Beste Naz Süllü, Head of Research at ICRYPEX, discussed the process of the Ripple case, which will take place on February 22, its possible implications for Bitcoin and Ethereum, and the potential consequences of the lawsuit between the SEC and Ripple.
When is the Ripple case?
The U.S. District Court for the Southern District of New York has set February 22, 2021 as the preliminary hearing date for the case between the U.S. Securities and Exchange Commission and
Ripple
Labs.
According to the SEC’s filing, Ripple’s co-founder, chairman and former CEO Christian Larsen and the company’s current CEO, Bradley Garlinghouse, have raised capital to fund the company’s business. The petition alleged that Ripple had been collecting funds by selling its digital assets, known as XRP, unregistered to investors in the U.S. and around the world since 2013, but that Ripple also distributed billions of XRP in exchange for non-cash considerations such as labor and market-making services.
You may notice: Ripple
What Does Litigation Mean?
The U.S. Securities and Exchange Commission has described private companies’ cryptocurrencies as “unregistered,” saying they must be registered with the U.S. Securities and Exchange Commission. Although it has only filed the lawsuit against
Ripple
for the time being, it seems to be a harbinger of other lawsuits or corrections in the future. During this litigation process of XRP, the SEC considered Bitcoin and Ethereum as cryptocurrencies and stated that XRP is not a cryptocurrency. He positioned XRP as an unregistered security.
How XRP and Ripple Were Affected by the Lawsuit?
Following the opening of the lawsuit, XRP suffered a serious loss of value. The price of XRP, which was at $ 0.50 before the news of the case, fell to $ 0.21 levels and lost more than 50 percent of its value. However, during the litigation process, some crypto money exchange organizations removed the crypto currency from its platform, predicting that XRP would likely lose value during the litigation process. At this point, there is a question in the minds of investors what will happen if the SEC wins its lawsuit. XRP will be considered a security if the litigation process makes a decision on the SEC side. In such a case, on the bright side , it can enter the New York Stock Exchange and make transactions. In fact, even on the bad side, there are good aspects in terms of XRP. On the other hand, the UK and Japan have shown their support by accepting
Ripple
XRP as a Utility Exchange token.
Bonus:
What Happens to Ripple? What Does the Ripple Litigation Process Mean? What Does It Mean for XRP to Be a Security? Tuncay Yıldıran, Member of the Board of Directors of Icrypex, and Beste Naz Süllü, Head of Research at Icrypex, evaluated the litigation process between the SEC and Ripple, which directly affects the cryptocurrency ecosystem. YILDIRAN evaluated what the issues mentioned by the SEC mean, why they affect XRP, and on which exchanges XRP transactions that have started to be issued from the US stock exchanges can be carried out.
Latest Developments on the Ripple Case:
- The preliminary hearing of the Ripple and SEC case took place on February 22. The hearing, which was open to everyone, discussed mutual accusations. Most notably, according to a claim by Ripple about the SEC, the SEC did not issue any warning to the exchanges it interviewed that XRP was a security. Ripple’s lawyers also disputed the SEC’s claims that Ripple was selling XRP even though it knew it was a security. On the other hand, according to the comments of the crypto money community, Ripple founders Brad Garlinghouse and Chris Larsen’s denial of the accusations and counter-accusations show that the SEC’s hand is weak.
- Following the ongoing litigation between Ripple and the SEC, MoneyGram has decided to suspend trading on the Ripple platform. As a reason; “Due to uncertainty regarding its ongoing litigation with the SEC, the company has suspended trading on the Ripple platform,” it said.
- MoneyGram has been sued by a major law firm for using misleading statements about its partnership with shareholders Ripple and XRP.
- Chris Larsen, one of the co-founders of Ripple, said in a statement; He stated that Ripple will continue to hold its headquarters in San Francisco.
- Ripple (XRP) CEO Brad Garlinghouse made a statement on Twitter on March 4 regarding the SEC case. He reported that he had requested that the case be dismissed against the SEC’s amended complaint. Ripple, which has filed a 5-page petition requesting RDED, stressed that XRP sales cannot be considered “securities sales” in any form.
- In the process of litigation with the SEC and Ripple, XRP holders caused $ 15 billion in losses.
- Ripple CEO Brad Garlinghouse told Reuters that since the lawsuit filed by the SEC, it has managed to sign 15 new contracts with banking institutions. According to Garlinghouse, Ripple is able to work quite harmoniously with Asian countries.
- Kraken CEO Jesse Powell on Ripple; After blockchain company Ripple was sued by the U.S. Securities and Exchange Commission (SEC) at the end of December, he stated that the token poses a “great risk” for exchanges.
- Ripple CEO Brad Garlinghouse has announced that he is ending his partnership with MoneyGram.
- New dates of the Ripple case have been announced; The SEC, former CEO of ripple Chris Larsen and current CEO Brad Garlinghouse represent the parties. In the document published on Twitter. According to this document, the opening defenses will take place on April 12 with Ripple officials, the detailed explanation for the SEC on May 14 and the detailed disclosure of the SEC. Ripple authorities are then given until June 4 to respond to the SEC’s submissions.
- During the SEC and Ripple litigation process, they were told by the SEC that Bitcoin (BTC) and Ethereum (ETH) cannot be compared to XRP.
- Ripple says it has shared 303,000 pages of documents for the SEC investigation. His SEC is looking for evidence that he contributed to the “market turmoil.” At the same time, Ripple’s lawyers write that the documents related to Bitcoin and Ethereum are indeed relevant to the case, against the arguments of the US Securities and Exchange Commission (SEC).
As of February 22, the developments in the case between Ripple and the SEC are listed in this order.