The cryptographic community is extremely curious about what will happen to Ripple Labs and the token asset XRP, after the United States Securities and Exchange Commission (SEC) recently filed a lawsuit against Ripple and two executives. On December 25, the large cryptocurrency exchange Bitstamp announced the closure of the XRP for US customers, and a former SEC commissioner believes the lawsuit will cause billions of losses to innocent third parties.
Luxembourg Crypto Exchange eliminates XRP support for US customers: ‘It will closely monitor the situation as it unfolds and adapt accordingly’
One of the most current conversations in the cryptographic space, in addition to the high prices of all time, are the recent accusations against Ripple Labs that were made by the US Securities and Exchange Commission (SEC). The second said that the regulator “filed a lawsuit against Ripple Labs Inc. and two of its executives, who also hold important titles, claiming that they raised more than $ 1.3 billion through an ongoing digital asset offering, and not registered “.
Following the SEC’s accusations, three exchanges (OSL, Crosstower and Beaxy) decided to discard XRP support, along with the Bitwise Asset Management fund. On December 25, 2020, the Luxembourg-based cryptocurrency exchange, Bitstamp, announced it would be stopping XRP services for all US customers on January 8, 2021. In a blog post on the subject, Bitstamp said:
In light of the SEC’s recent filing against Ripple Labs Inc., which claims XRP is a security, we will suspend all XRP trades and deposits for our customers in the United States on January 8, 2021 at 9:00 PM UTC. We will follow the development of the situation closely and continue to adapt. Our customers in the U.S. will still be able to remove XRP from Bitstamp. Customers in other countries are not affected.
SEC action will cause substantial damage to innocent holders
The XRP action is also taking place when SEC President Jay Clayton decided to resign. SEC Commissioner Hester Pierce announced on Twitter that Elad Roisman was named acting president of the US financial regulator. “Congratulations, President Roisman,” Pierce tweeted on December 24th. “I look forward to your leadership at the SEC,” she added. In addition, The Block’s Frank chaparro obtained a letter from Joseph Grundfest, a former US SEC commissioner.
According to a Letter for Jay Clayton, Grundfest allegedly said that the Ripple lawsuit was “unprecedented” and there is “no urgent reason for immediate action”. “The views of an administration and Congress in the near future on the regulation of transactions similar to those in question may differ substantially from current perspectives,” details the letter from Grundfest.
The former SEC commissioner also wrote:
Simply initiating action will inflict substantial damage on innocent XRP holders, regardless of the final resolution. Upon becoming aware of the process, intermediaries will stop trading on XRP due to the associated legal risk. The resulting reduction in liquidity will cause the XRP value to decrease.
SEC acting acting president Elad Roisman also allegedly discussed the evolving cryptocurrency markets in 2018. “The SEC must review and review its rules, regulations and guidelines to ensure that they are still functioning as intended to fulfill the SEC’s mission” , Roisman said at the time. “This has manifested itself more recently in areas such as data protection and cybersecurity, as well as the emergence of new investments and technologies, such as initial coin and blockchain offerings.”
What do you think about Bitstamp abandoning XRP for US customers and the letter from ex-commissioner Joseph Grundfest? Let us know what you think about this in the comments section below.
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