Skip to main content

Cryptocurrency XRP Plunges 25% After SEC Files Lawsuit Against Ripple

 

  • Cryptocurrency XRP sank nearly 25% to around 35 cents Wednesday morning.
  • The SEC is suing Ripple and two of its executives over the alleged sale of unregistered securities.
  • Ripple denied XRP is a security and questioned the lawsuit's timing.

The price of XRP plunged again Wednesday after the U.S. Securities and Exchange Commission filed a lawsuit alleging that Ripple, a blockchain company with ties to the cryptocurrency, conducted a $1.3 billion unregistered securities offering.

XRP sank nearly 25% to around 35 cents Wednesday morning, according to data from cryptocurrency market site CoinDesk. 

The virtual currency fell as much as 17% on Tuesday after Ripple said it anticipated and would fight the legal action.

The SEC is suing Ripple and two of its executives, CEO Brad Garlinghouse and co-founder Chris Larsen. 

At the heart of the federal agency's complaint is the claim that XRP should be treated as a security — like a share in a company — rather than a currency.

"We allege that Ripple, Larsen, and Garlinghouse failed to register their ongoing offer and sale of billions of XRP to retail investors, which deprived potential purchasers of adequate disclosures about XRP and Ripple's business and other important long-standing protections that are fundamental to our robust public market system," said Stephanie Avakian, director of the SEC's Enforcement Division.

Ripple denies this, stating that XRP is a currency and should not have to be registered as an investment contract. 

The company questioned the lawsuit's timing — SEC Chairman Jay Clayton is soon to stand down — and said the U.S. government and other regulators had previously given XRP currency status.

XRP lost its place as the world's third-most valuable cryptocurrency, with tether — a dollar-pegged token investors often use to trade crypto — surpassing it in value Wednesday, according to CoinMarketCap data.

The "security" label matters because it could bring XRP under strict new rules, and this would heavily impact Ripple. 

Ripple owns 55 billion of the total 100 billion XRP tokens in existence and even makes revenue from selling some of its XRP holdings each quarter.

XRP was created and distributed by the founders of Ripple in 2012, and is meant to facilitate fast cross-border money transfers. 

The price of XRP has risen in tandem with bitcoin and other cryptocurrencies this year, however it is still down about 90% from its peak in late 2017.

The company Ripple was last privately valued at $10 billion and is backed by the likes of Japanese financial services giant SBI Holdings, Spanish bank Santander and top venture capital firms including Andreessen Horowitz, Lightspeed and Peter Thiel's Founders Fund.

Ripple had threatened to move its headquarters outside of the U.S. over a lack of regulatory clarity in the U.S., with London, Switzerland, Singapore, Japan and the United Arab Emirates tipped as potential locations.

Source: nbcdfw.com

Comments

Post a Comment

Contact us

Name

Email *

Message *

Popular posts from this blog

Cryptocurrencies Adding to the Safety and Security in the UK Gambling Industry

These are exciting times for the UK gambling industry. The impact of internet technology is now being felt with online gambling now controlling the industry.  The adoption of cutting-edge technology is reasonable for the boom in the industry. From live casinos, mobile apps to artificial intelligence, incredible trends continue shaping the gambling industry. However, it is the rise of cryptocurrency casinos that seeks to redefine UK gambling.  Many operators now include crypto coins such as bitcoin, Ethereum and Litecoin as part of their banking methods. Others offer exclusive bitcoin payments and promotions based on digital tokens. This revolutionary trend has a huge impact due to enhanced safety and security on these platforms. Players looking for peace of mind when playing online now opt to use cryptocurrencies. This post looks at how cryptos guarantee the safety and security of players at online casinos. How Cryptocurrency Gambling Works There’s a lot of talk ab...
Post a Comment
Read more

Coinbase to Require Recipient Information for Crypto Transfers From Users in Canada, Singapore and Japan

  Customers in those countries who send crypto outside their Coinbase accounts must provide recipients’ names, addresses and in some cases, additional information, as of early April. Cryptocurrency exchange Coinbase Global (COIN) will soon require its customers in Canada, Japan and Singapore who send cryptocurrency to another financial institution or exchange to provide the name, address and in the case of Japan, the destination wallet of the recipient. Coinbase has been sending notices to its customers in those countries that the changes will take effect in early April in order to comply with local travel rules in those places. Coinbase didn't immediately respond to requests for additional comment on the moves, but confirmed that they were taking place. The move  does not seem to be going over well  with Coinbase customers in those countries, who value the anonymity of transactions using cryptocurrency. According to a  FAQ provided by Coinbase , for Canadian users, ...
Post a Comment
Read more

Quomodocunquize

                                       Definition:  " To make money in any way possible . ” Example:  Rather than quomodocunquizing,  invest your money wisely . Please, please, please use a hardware cold wallet like Ledger . It's  a  cold wallet ,  cold  =  not exposed  to  internet  =  only your hardware device . ...  Use Ledger  as  cold storage . Too many people spend money they earned..to buy things they don't want..to impress people that they don't like. --Will Rogers A wise person should have money in their head, but not in their heart. --Jonathan Swift Wealth consists not in having great possessions, but in having few wants. --Epictetus Money often costs too much. --Ralph Waldo Emerson Everyday is a bank account, and time is our currency. No one is rich, no one is poor, we've got 24 hours each. --Christopher...
Post a Comment
Read more