Ripple Labs has officially responded to the U.S. Securities and Exchange Commission (SEC) complaint. In addition to declaring that the XRP cryptocurrency is not a security, Ripple has accused the securities regulator of failing to pick winners and losers and falsifying facts related to the cryptocurrency.
- In the court document filed on Jan. 29, Ripple alleges that XRP is not an “investment contract” and insists that the crypto is “a virtual currency and is therefore beyond the purview of the SEC”. In addition, the company stated that it would never hold an initial coin offering (ICO), never offer future tokens to raise funds, and have no relationship with the vast majority of XRP holders.
- The SEC was “nationally and globally out of step,” claims Ripple. The company found that no other regulators in the world have viewed XRP as a security. Ripple claims, “Basically, on its way out, the Trump administration tried to undo the finding that XRP was a virtual currency that was made during the Obama administration.”
- Regulators that have concluded that XRP is not a security include the U.S. Department of Justice and the Financial Crimes Enforcement Network (FinCEN), as Ripple noted in its response. The two US authorities established in 2015 and 2020 that XRP is a virtual currency. In addition, the company added that the UK’s Financial Conduct Authority (FCA) and regulators in Singapore and Japan have also concluded that XRP is not a security.
- Ripple also accuses the SEC of “picking winners and losers”. The company claims that “there is no fundamental difference between the current function of XRP and that of BTC or ETH.” However, the SEC notes that the two cryptocurrencies are not securities. Additionally, Ripple stated, “XRP is much more environmentally friendly than BTC and ETH as it avoids the degradation process. That must be important from a political point of view. “
- In addition, Ripple alleges that the SEC “skewed the facts” stating that “the complaint filed by the SEC is full of out of context quotes and draws conclusions that are unsupported by both the facts and the law.”
- The SEC filed a lawsuit against Ripple Labs, CEO Brad Garlinghouse and co-founder Christian Larsen in December. Following the SEC lawsuit, several major cryptocurrency exchanges delisted XRP, including Coinbase, Binance, Okcoin, and Blockchain.com.
- Ripple wants to resolve the dispute with the SEC as soon as possible, noting that XRP has lost nearly half of its market value as the securities watchman filed the lawsuit against the company and its executives. As a result, XRP retail investors with no connection to Ripple have suffered billions in losses.
What do you think of Ripple’s response to the SEC’s allegations? Let us know in the comments below.
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