Last year, Brad Garlinghouse, CEO of Ripple, had considered an initial public offering for the company during the World Economic Forum in Davos, Switzerland.
Previously, the company raised about $200 million in a $10 billion risk financing round led by Tetragon Financial Group. The value of the signed product, a cryptocurrency called XRP, fell last year. But Ripple poised to rebuild its cross-border trade infrastructure, said Garlinghouse, promising a bright future.
Is XRP a Security?
One year later, the IPO got cancelled. Instead, Ripple’s future entirely depends on a civil judge’s ruling filed by the Securities and Exchange Commission in December.
Regardless of the outcome, this case will set a significant precedent for how US regulators create rules and laws for cryptocurrencies. It also exposes the broader truth about most digital currencies except Bitcoin and Ether. Most of the hundreds of others struggle to find utility beyond speculation.
At the centre of the SEC’s case is the debate over XRP, a bitcoin-like digital asset created by Ripple’s founder, the world’s third-largest cryptocurrency. It should be part of a network that helps banks reduce cross-border transfer fees.
By trading XRP between fiat and other virtual currencies on more than 200 exchanges worldwide, most of them have nothing to do with Ripple. However, related software has never been essential, according to the SEC. XRP has no apparent purpose other than selling Ripple.
Ripple SEC Lawsuit First Court Date Set
According to legal documentation filed with the US District Court in the southern region of New York, the first virtual trial will take place on February 22 to determine Ripple’s fate.
Legal advisers to the persons named in the case – Ripple Labs, CEO Brad Garlinghouse, and CEO and co-founder Christian Larsen – were invited to an online pre-conference with Analytical Judge Torres.
The order obliges the parties to submit a joint statement by February 15, setting out the arguments and legal basis for the case, possible proposals, and a potential deal.
The SEC also said that international law firms told Ripple that XRP could not be a currency because it was not supported by the central government and therefore not legal tender.
The exchanges Coinbase, Beaxy, OSL, OKCoin, Ziglu, and iTrustCapital delisted trading local Ripple assets but chose to do so in all countries where they operate. Market makers Jump Trading, and Galaxy Digital is taking a similar approach.
Crypto exchanges that have entirely wiped out XRP in the US include BinanceUS, CrossTower, Crypto.com, and Bittrex. The swipe crypto wallet also wiped out XRP in the US. Today’s XRP price was $ 0.278189 and up by 2.21% over the last 24 hours