U.S. Securities and Exchange Commission partially wins case against Ripple (XRP) Foundation
Haebom
The hottest lawsuit in the blockchain space since 2020 is the lawsuit between the U.S. Securities and Exchange Commission (SEC) and the Ripple (XRP) Foundation.
The lawsuit has been ongoing for over two years and the first ruling was issued on July 13, 2023.
Opinions are divided on whether this should be seen as a partial victory for the SEC or a de facto victory for XRP.
Immediately after the announcement of the verdict, XRP was quoted at over 600 won and 1,000 won, but is currently settled in the 900 won range.
Both are burning with the will to appeal as they are not satisfied with the result
The SEC started the lawsuit by claiming that Ripple intentionally expected the issuance volume and profits when selling/distributing XRP on cryptocurrency exchanges → Simply put, it started with suspicions of planned listing + power play.
Additionally, there are claims that Ripple illegally sold/distributed XRP in exchange for services provided for Ripple's operation, whether it expected profits from third parties, invested money, or otherwise.
As the lawsuit progresses, the SEC states that Ripple is selling XRP as a security.
(At this time, the concept of security tokens (STOs) had not yet been fully established - December 2020)
To cut to the chase, SEC wins in part
$728.9 million worth of XRP sold to institutional investors before and after the exchange listing was recognized as illegal sales of unregistered securities
Should we consider this as an initial investment in a startup, or selling securities, or a trick to make a profit? It is true that it was wrong to give it to the institution in advance, and it was not wrong to release it on the exchange.
However, XRP's innocence has also been proven
The court ruled that Ripple had received no money from executives, employees, or third parties before or after the listing.
In a way, the rebate and price manipulation issues that had raised suspicions about the Ripple Foundation have been cleared up.
To summarize, Ripple is suspected of illegally selling/distributing XRP, an unregistered security, to ① institutional investors such as hedge funds, ② general investors on exchanges, and ③ other parties...
① Quote
② Rejected
③ Partial quote
In one sentence, "It is true that XRP was initially distributed to institutional investors and hedge funds, but it is ambiguous to view XRP as an investment contract security, so the SEC's argument is not accepted."
XRP is claiming innocence and will appeal.
The SEC is openly stating that it will appeal the ruling.
It looks like the second round will start → The market is accepting this as positive news since it can be seen as Ripple's victory in the short term.
This is considered a major event in the blockchain and cryptocurrency markets and the verdict has great significance, so it is recorded for the record.
I personally do not hold XRP and I am posting this after seeing the overheated XRP chart calm down (based on RSI).
For more details, please see the review of the judgment analysis written by the lawyers.
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