The United States Securities and Exchange Commission (SEC) filed a lawsuit against Ripple and its two executives for conducting a $ 1.3 billion unrecorded bond offering in the form of XRP. After the news, some encryption exchanges started to remove XRP. Consequently, the price plummeted to $ 0.22 on December 24. The price is currently being negotiated above $ 0.26, after buyers have started accumulating the fourth largest cryptocurrency at a discounted price.
The cryptocurrency market is in a panic. Overall market capitalization fell by more than $ 50 billion in less than 24 hours, as Bitcoin, Ethereum, Bitcoin Cash and Chainlink also participated in the settlement. There is no doubt that the recent negative sentiment is due to the uncertainty generated by the SEC. Despite the reason the SEC recognized Bitcoin and Ethereum as a payment system, retail investors are selling their shares for fear of a major crash.
The cryptographic community reacted strongly
The SEC received criticism from the crypto community for its recent action against Ripple, as the community expected a clear regulatory framework instead of the process.
Khurram Shroff, president of an investment firm based in Dubai IBC Group, expressed his views with Finance Magnates on the latest developments. “XRP is the fourth largest cryptography in the world and the only one based in the USA. I would have advised the regulator to take a softer approach to Ripple and should have had the opportunity to register it as a title instead of a lawsuit. Given that it is a U.S.-based global pioneer in Blockchain. This will not only hinder blockchain adoption in the U.S., but will also depress the global cryptocurrency economy, giving China more power over the cryptocurrency world.
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XRP buyers getting ready
During this difficult period, not everyone is selling crypto assets, some people have identified this as an opportunity to buy at a lower price. We haven’t seen any institutional news in the past few days, but some retail investors are slowly increasing their holdings in XRP. Johnny McCamley, founder of CryptoClear told Finance Magnates that he expects the XRP to gain regulatory clarity soon.
“The SEC action that is suing Ripple simply delays the inevitable that XRP gains regulatory clarity and is considered: NOT a bond. What this title does, however, is to scare retail investors into selling and scare new investors to buy XRP. I bought more XRP at ‘discounted prices’ around $ 0.22, as I know the long-term value of XRP. As an investor, I am the opposite of the majority. Investors want to invest in XRP when the value of XRP is 3x, I still invest at these levels, but my point, being the average investor, will be scared when it decreases by 3x in value, the opposite should be true, I buy more than normal when there is ‘blood on the streets’, so to speak, ”said McCamley.
He added that the recent process is really useful for XRP. “This process will accelerate the regulatory clarity that XRP needs that BTC and ETH have. Both Bitcoin and Ethereum have been declared NOT as a bond in the U.S. [It is] It is a pity that he needs to follow this path, but I am sure that Ripple will prevail. It is in the interest of the United States and the future of digital currencies. XRP will get regulatory clarity sooner than expected, regulation is closer than ever, especially with Sandie O’Connor, who joined Ripple’s Board of Directors. O’Connor has more than 30 years of leadership experience with a deep background in finance, treasury, capital markets and regulatory affairs. I can only see this process going in one direction [the] the result that determines XRP is NOT a security, ”added the founder of CryptoClear.