Coinbase announced today that it is halting all XRP trading on its cryptocurrency exchange, according to an official blog post (via Coindesk) Certain types of business have been restricted today, and the total suspension will take effect on January 19, 2021 at 10:00 am Pacific Time. Coinbase is the largest cryptocurrency exchange, and the suspension of a currency like XRP naturally casts doubt on the currency’s future, even before the SEC lawsuit is closed.
Coinbase says it made the decision to suspend XRP “in the light” of the lawsuit that the United States Securities and Exchange Commission (SEC) filed against the original creator of XRP, Ripple. With the suspension in place, people will no longer be able to trade XRP at Coinbase, although they can still deposit and withdraw from their XRP wallets.
In the process that started everything, the SEC’s main concern is what an XRP really is. The SEC claims that the XRP is a security and should be treated as such. This means that the former CEO and current CEO of Ripple should be responsible for disclosing a variety of additional information needed to access XRP risks prior to any investment. Ripple, of course, believes otherwise. In Ripple’s opinion, XRP is a currency and therefore is not under the jurisdiction of the SEC. To learn more about why the name XRP is important, check out my colleague Liz Lopatto’s article.
Coinbase is the highest-profile exchange to suspend XRP, but other exchanges like Bitstamp and OK Coin made similar decisions after the SEC’s legal action. With the simple announcement of a lawsuit, the SEC has already impacted XRP’s short-term future.