What happened
Over the last 24 hours, the price of the XRP (CRYPTO: XRP) token had risen more than 8.5% as of 1:18 p.m. EST today. Executives at Ripple, the company closely associated with XRP and the XRP ledger, recently said that a closely watched lawsuit they are involved in with the Securities and Exchange Commission (SEC) is going well.
So what
The SEC previously sued Ripple, its CEO Brad Garlinghouse, and Executive Chairman Chris Larsen, alleging the parties conducted an illegal securities offering when it issued XRP.
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“The lawsuit has gone exceedingly well, and much better than I could have hoped when it began about 15 months ago,” Garlinghouse told CNBC yesterday. “But the wheels of justice move slowly.”
Garlinghouse’s comments come after a judge ruled earlier this week that the SEC cannot alter emails that are set to be released as part of the case and which could help Ripple’s argument.
Now what
The outcome of the case between Ripple and the SEC could have broader outcomes for Ripple as a company and for the entire crypto industry.
According to Garlinghouse, if the SEC wins the case then most cryptocurrencies on U.S. exchanges would be considered securities, which means the exchanges would have to become registered broker-dealers with the SEC.
“If you determine XRP as a security of Ripple, we have to know every person that owns XRP,” added Garlinghouse. “That’s an SEC requirement. You have to know all of your shareholders. It’s not possible.”
Garlinghouse also implied that the case has negatively impacted Ripple, which positions itself as a substitute for The Society for Worldwide Interbank Financial Telecommunication (SWIFT), which plays a key role in helping banks transfer money around the world. He said the company did not sell any enterprise contracts to U.S. financial institutions in 2021.
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