XRP Investors are betting on a favorable hearing outcome, as Ripple Labs faced plenty of scrutiny in US courts for the alleged role in misguiding investors in selling unregistered securities. In our latest Ripple news today, we are reading more about it.
XRP prices increased 20% over the past day and over 103% in the past month as the data from CoinGecko shows. The coin dropped from over $0.7 back in November 2020 to under $0.25 in January 2021 following the news of the hearing. According to a release by the US district court of New York, Ripple Labs and the US Securities and Exchange Commission are battling in court and represent their cases and arguments in front of criminal authorities for the first time ever. The XRP investors are betting on a positive outcome.
The SEC is now in a discovery mode with its case against the platform which is a trial phase set to run until August 16, 2021. The agency alleged that Ripple sold over $1.3 billion worth of coins to retail investors without the needed documents or legal approval in addition to the founding team Brad Garlinghouse and Chris Larsen who was named in the lawsuit for profiting to the tune of hundreds of millions of dollars. The SEC wrote in the complaint:
“Ripple engaged in this illegal securities offering from 2013 to the present,” adding the firm received legal advice “as early as 2012” that its token could be considered an illegal investment offering under.”
Ripple continued to maintain its innocence and stated that XRP is both not security and most certainly not controlled by the team. The San Francisco-based company distanced itself from XRP over the years after it launched and distributed the token back in 2012. However, the company still holds over 50 billion XRP to sell on the open market that is meant to fund its business activities. With the landmark case, Ripple is the biggest crypto issuer that ended in a legal battle with US securities.
In the meantime, CEO Brad Garlinghouse expressed frustration over the legal proceedings, trashing the claims and saying that Ripple will continue using XRP because it is the best digital asset for speed, cost, scalability, payments, and energy efficiency:
“The SEC, out of step with other G20 countries & the rest of the US govt, should not be able to cherry-pick what innovation looks like (especially when their decision directly benefits China).”
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