Ripple will be sued by the SEC for alleged sale of unlicensed securities in the form of XRP tokens, said Fortune.
In a move reminiscent of Coinbase’s recent front run of a New York Times Ripple CEO Brad Garlinghouse revealed the alleged treatment of colored workers and has taken the unusual step of posting on Twitter to seemingly legally settling the matter in court of public opinion.
Today the SEC voted to attack crypto. Chairman Jay Clayton – in his latest act – picks winners and tries to limit US innovation in the crypto industry to BTC and ETH. (1/3) https://t.co/r9bgT9Pcuu
– Brad Garlinghouse (@bgarlinghouse) December 22, 2020
Bitcoin and Ethereum have both escaped SEC enforcement due to their decentralized nature. However, XRP, the token associated with Ripple, has long been criticized by some members of the crypto community as being highly centralized. Ripple has blocked a bill of about 50 billion XRP, or about half of the total supply, that CTO David Schwartz claims to be ‘gifted’ by the creators of the third largest cryptocurrency.
Despite class-action lawsuits and bitter splits between the original founders, Ripple has survived to become one of the fintech industry’s richest companies, with a reserve – mainly in XRP – that could theoretically be worth nearly $ 25 billion. even after a dramatic 13.5%. decline in the price of the cryptocurrency token after the news of the possible lawsuit.
A source with connections to Ripple told Cointelegraph that:
“There is no way [XRP] is not a certainty. “
Ripple has one Wells submission document on its website setting out its position, claiming that “ By claiming that Ripple’s distributions of XRP are investment contracts while insisting that bitcoin and ether are not securities, the Commission chooses virtual currency winners and losers, thereby destroying US-based, innovation in the process. “
The company continued to argue, without proof, that Bitcoin and Ether are “ two Chinese virtual currencies that the SEC has stated are not securities ” and that “ innovation in the cryptocurrency industry will be completely ceded to China ” if the possible lawsuit were be tightened. by the SEC are successful.
According to Fortune, both Garlinghouse and co-founder Chris Larsen, whose combined net worth is estimated at $ 13 billion, are expected to be named as defendants in the potential lawsuit.
Although Garlinghouse has stated that Ripple would continue to thrive even with a security tag for XRP, the company recently claimed looking for new headquarters outside the United States, claiming a lack of regulatory clarity got his hand.
CoinTelegraph reached out to Ripple for comment on whether Larsen and Garlinghouse would remain in the United States in light of the potential lawsuit, and had received no response at the time of publication.