Dennis Y.Wed, Sep 22, 2021 10:35 AM
Time Machine: The Most Significant Ripple News for the Past Two Years
It's been quite some time since crypto people have been worried about the fate of Ripple. It's a good time to take some stock of what has happened since Ripple went to war with the SEC. So, what's the Ripple News?
Notably, the Ripple technological project itself is not as closely tied to the fate of the XRP token, which is traded on exchanges.
Yes, the SEC has a grip on it, but the Ripple project itself is working closely on payment sector breakthroughs and so its successes or failures will not influence the price of the token any more as much as you might think. We are going to talk about the reason for this below.
At first, let's briefly recap the most significant things, and see what was going on through the year with this crypto asset. The events developed in a very interesting way.
Brief Reminder: What is Ripple really is?
Bookmark this collection of key information on Ripple / XRP News and Price Analysis. Here is a collection of basic and important information.
Ripple Labs is a technology company that has created the distributed XRP Ledger and Interledger Protocol, the crypto platform and enterprise blockchain of the same name, the XRP cryptocurrency, and the RippleNet product for financial institutions.
This product helps banks to send money to any country in just seconds and at a minimal cost. Also, the company is actively developing advanced payment and liquidity service (ODL) mechanisms for currency exchange
Ripple digital currency was founded in 2012. Now, despite battles with the SEC, it is expanding (it is quite a good indication), opening a division in Japan and Korea (SBI Ripple Asia), as well as a research and training center - the University Blockchain Initiative (UBRI).
Ripple's customers are represented by banks and payment systems, including MoneyGram, Santander, Azimo, Siam Commercial Bank, etc. Clients' network includes more than 300 banks, but most of them do not use XRP cryptocurrency XRP is Ripple's token for so-called "cross-border payments". At the time of writing, according to CoinMarketCap, the XRP token is the 6th most capitalized (nearly $50.5 billion) at about $1.
XRP / Ripple News: Dispute with U.S. Authorities
The lawsuit between fintech company Ripple and the U.S. Securities and Exchange Commission (SEC) began back in 2020 and looks set to drag on until at least 2022.
XRP / Ripple News - 2020
On December 22, 2020, the SEC accused Ripple management of violating U.S. securities laws, citing the fact that XRP tokens are not registered under U.S. laws. According to the SEC, XRP is a security and its circulation in the market is illegal. The total amount of the issue that went to the SEC's teeth was $1.3 billion. As a backdrop, XRP plummeted, more than threefold, from $0.63 to $0.22 in December 2020.
The parties were given the opportunity to settle out of court, but they declined because they found it impossible.
XRP / Ripple News - 2021
- Coinbase, like a number of other exchanges, suspended XRP trading because of an SEC lawsuit in January. In the summer of 2021, there were rumors of XRP returning to this platform, but the company denied it.
- In February 2021, a pre-trial hearing began, through which the facts on the SEC's contacts with crypto exchanges regarding XRP surfaced. It turned out that the commission had not alerted the trading venues to the situation. This played in XRP's favor, and the XRP price jumped to $1.5 - $1.8 by April. In fact, XRP gained more than 750 percent in three months after the response.
However, the SEC claimed that Ripple knew about the state of the XRP prior to its initial release. Ripple CEO Brad Garlinghouse described the SEC's charges as unfounded and said that the Commission's actions posed a serious threat to the whole US crypto market
- In March, Ripple accused the SEC of abuse of its authority. It noted the XRP token is essentially ordinary money, so it is not under the SEC's jurisdiction.
- The case was litigated all through March. The SEC requested access to the banking info of Ripple's executives, and they asked the court to deny the SEC access. In the end, Ripple's request was granted with finding the SEC's request inappropriate.
- In April, Ripple had requested a report from the SEC about how it classifies Bitcoin and Ethereum and whether it considers their securities.
- From April to June, the market experienced a strong decline of XRP - more than twofold: from $1.54 to $0.71. The reason also was the overall negative dynamics of the crypto market, which collapsed from the ATH reached earlier.
- On August 27, Ripple submitted a filing to force the SEC to uncover its inside crypto trading rules.
Why? To find out if the SEC has permitted its employees to trade XRP, which the Commission itself alleges is unregistered security. Also, an adequate response to the SEC's demand for huge volumes of Slack messages from Ripple is needed.
- The SEC suspects Ripple's administration of making illegal profits. And in May, a court granted the commission's request to consult with foreign financial regulators about the token.
- And in June, the SEC requested a two-month delay in reviewing the case, which the court granted. It also ordered the SEC to disclose how it classifies other cryptocurrencies and distinguishes XRP from similar digital assets.
XRP nearly doubled in value from $0.68 to $1.26 in June and August amid a judicial lull. They considered the absence of Ripple News as good news.
- In September, nearly 120 million XRP tokens were moved by Binance, Bitfinex, Bitstamp, BitGo and several other exchanges and platforms (according to Whale Alert). The nature, causes and consequences of this will not be fully known.
- On September 14, new findings surfaced in this dispute. The SEC issued a paper that describes negotiations with reps from SBI Holdings (Ripple's main partner), and some other companies. The meetings during 2017 - 2019 and discussed the XRP.
However, there is a suggestion that it doesn't have much impact. Although somebody at these gatherings mentioned that XRP tokens should be registered, this can't be considered as an officially stated SEC's position, but rather as a matter of an individual's judgment.
- On September 15, Charles Gasparino (FOX Business Network) tweeted about the regulator's logic for recognizing or not recognizing a token as a security (he was referring to his sources).
The SEC considers the XRP token security because Ripple's infrastructure is still building with it. And the Ethereum blockchain development is complete and has been running for years, so the SEC recognizes that it is a security. Ripple is still using XRP to fund businesses, so the SEC considers it unregistered security, Gasparino wrote.
Twitter crypto community criticized the SEC, noting the inconsequential position of the regulator. They noted, for example, that Ethereum recently launched an update, so it's still under development, too.
What does all this say? That the SEC itself apparently doesn't yet fully know how or what to base its charges on. As we can see, Ripple has good lawyers, and probably they will be able to defend the company against such vague wording.
On the other hand, the CEO of Ripple Labs, Brad Garlinghouse, admitted to financing Ripple's business with the sale of XRP. So for now, the position is ambiguous. One thing we can say with certainty is that it will be fascinating to observe it further.
Basics of United Resistance to the Regulator (Or Did It Just Seem to Us?)
In general, we can note that Ripple news, kind of we described above, is enjoying all the crypto community and industry not only with its proactive stance and unwillingness to tolerate injustice and fight for its ideas, but also the openness of its leadership and desire to support the market in general.
For example, the head of Ripple said that the warning Coinbase received from the SEC about one of their products put the exchange in a similar situation to his company. He highlighted that the Commission "continues the war on cryptocurrencies," and hinted at a possible collaboration between the two organizations. Which Coinbase, as we noted above, has not been confirmed.
Ripple's general counsel Stuart Alderoti also spoke out in support of the Coinbase exchange. He noted the clear regulatory frameworks of jurisdictions such as the U.K., Singapore, and Japan that encourage innovations. The situation in the U.S. is diametrically opposed, he said.
Interesting trend. If players like Ripple would join together, instead of disassociating from each other and unite in some associations to protect the rights of market players, perhaps they would not be so vulnerable to the ultimatum actions of the regulators.
However, such organizations are already emerging. For example, Coin Center - an organization to promote and protect the interests of the crypto industry. Coin Center director Jerry Brito called the SEC's action against Coinbase underhanded. He thinks, that Coinbase should release the product and confront the regulator directly.
He added that the alternative is for the Commission to initiate a case against a small player, settle with it pre-trial, and then use its scalp as a trophy. Brito pointed out that the industry needs court settlements to clarify the situation.
XRP / Ripple News: What's next for Ripple?
As you know, globally, much of the result of this situation will rely on an outcome of XRP tokens passing the Howey Test.
The final decision and really crucial XRP / Ripple News is not expected until January 2022 at the earliest. Right now, XRP price is dependent on rumors, news, and the general market situation. Just like all other tokens, unless they are artificially held against the market (pump or dump). If the crypto market continues to grow and Ripple wins the case, the coin may show significant growth.
But in general, you should not be guided by publications in this question and should not consider them as financial advice. It is important to remember that all investing and trading is done at the risk of each individual.
Before Ripple's case, the actions of the SEC usually meant the end of a particular crypto-project. That's what happened with Pavel Durov's TON / GRAM, for example. But the instance of Ripple is indicative because it refuses to give up and tries to "strike back at the empire".
And if the SEC does not win this time, it will create an interesting and extremely useful precedent for the cryptocurrency market. This means it will help the crypto industry become even stronger. Whether it will reduce volatility is unknown, but the positive effect of reversing the trend of super control and strict bans is hard to overestimate. Stay tuned, we intend to monitor events as they unfold.