Ripple v. SEC - A Quick Recap

?? On July 13th, a U.S. judge, Analisa Torres, issued a pretrial ruling in the Securities Exchange Commission’s (SECs) lawsuit against Ripple Labs.?

?? Ripple Labs developed the Ripple payment protocol, which created the XRP in June 2012 . In December 2020, the SEC sued Ripple and claimed the latter sold XRP tokens without registering them with the SEC.?

It meant the SEC defined XRP as a security, accusing Ripple of violating security laws in the U.S.

But the court ruled:

·? The XRP token is not a security

·? Ripple’s sales of XRP tokens on crypto exchanges is not a security offering

·? The XRP token is only a security when sold to institutional investors

?? The SEC is cracking down on several players in the cryptocurrency space as the regulatory body believes digital assets to be unregistered securities. Alternatively, crypto participants define digital assets as a currency which suggests the asset class should be regulated by the Commodity Futures Trading Commission.

?? The price of the XRP token is up over 80% in the last weeks as the judgment was cheered by investors. Comparatively, trading volumes have surged from $700 million to more than $3.5 billion in this period. Valued at a market cap of $42 billion, XRP is the fourth largest cryptocurrency in the world today.

???? The outcome of the verdict will have direct implications for crypto regulation in the U.S. and will act as a key catalyst for crypto players globally. It will also impact the lawsuits surrounding Binance and Coinbase, as the 'crypto crackdown' continues.

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