On 22 December 2020, the SEC (Securities and Exchange Commission) filed an action against Ripple Labs Inc. and two of its executives, who are also significant security holders, alleging that they raised over $1.3 billion through an unregistered and ongoing digital asset securities offering.
This lawsuit is not going to pass. We can’t overlook the facts. Ripple will be a part of the financial world. Read why.
Ripple employs a world-class team with experience in the finance and government sector. There is no way that these people are going to put their reputations in danger.
A Ripple IPO is possible. However, the retail investor who owns XRP doesn’t own stock in the company. Which means there are two securities of Ripple? This just doesn’t make sense.
The SEC is a shark in the oceans, and they have turned to Ripple looking for blame. I think the attention will be redirected to Tether. It’s an Inevitable outcome. Tether is a scam and artificially inflates the prices of crypto. People have called this out for years.
Christopher Giancarlo, aka “CryptoDad,” the former chairman of the U.S. Commodity Futures Trading Commission and known for his early embrace of digital assets, declared XRP is not a security. This is a significant endorsement for XRP and digital currency adoption - he is hoping to influence the classification of XRP as he did with Bitcoin. Could this be one of the most valuable companies in FinTech?
There are further tests that prove XRP is a currency, not a security. The Howie Test in the US refers to the U.S. Supreme Court case for determining whether a transaction qualifies as an “investment contract,” and would be considered a security and subject to disclosure and registration requirements. You have to meet all four prongs to be a security, and if Ripple were to go away, XRP would still exist, so it’s not a security.
Jay Clayton, the former Chairman of the SEC, knows how vital XRP is. The payments system is inefficient around the world. If we don’t address this, then the market will do it for us. As regulators, we should be leading this. It’s no coincidence that as soon as Jay Clayton leaves, ten other SEC people go and are replaced by a crypto expert. This is our moment.
Sandie O’Connor, recently retired from JP Morgan Chase, has come out of retirement specifically to join the Board of Directors at Ripple. She has a background in finance, treasury, capital markets, and regulatory affairs and will use her experience to develop a framework for the US. You think she would come out of retirement to join a company that would lose a lawsuit as soon as she enters? Absolutely not. There are so many proof points like this. Too many people are insecure about their investments. Why?
Zoe Cruz joined the Board of Directors at Ripple three years ago. She had a 25-year tenure at Morgan Stanley and was named one of the most powerful women in finance three years in a row. So it’s insane to think that she would be part of an ecosystem selling unregulated security.
Coinbase is also being sued over XRP commissions and has to defend XRP. This means we have the weight of both Coinbase and Ripple supporting XRP. Oh, how the tables have turned against Bitcoin.
This SEC lawsuit was a way to push a decision through quickly. Too many people are interested in the success of XRP for the lawsuit to hold weight.
This is the beginning of the crypto revolution. The world is never going to be the same again.