The Ripple case brought before the Securities and Exchange Commission threatens to have serious and ripple effects for the industry.
On January 29, Ripple Labs filed a response to the SEC’s complaint. Ripple has argued, as it has done many times before, that XRP is not a security, that is, an investment in Ripple, and therefore not within the SEC. Furthermore, Ripple is ready to engage the rest of the industry in its fight to prove its case.
A spokesman for Ripple told the Cointelegraph:
“It is clear that the SEC has picked winners and ignored a growing and resilient industry that is much larger than Bitcoin and Ether. In addition to the discovery, which we will look at directly in the lawsuit, we have filed a Freedom of Information Act (FOIA) request for more information. About how it determined the Securities and Exchange Commission’s status to the ether as unprotected. ”
The relevant FOIA request, available here, casts doubt on Ether’s case. SEC officials have repeatedly stated that while pre-sale may be an offer of securities at the time, Ether is decentralized enough to qualify as a commodity, and thus trading in Ether in the United States is subject to futures trading jurisdiction. . . commission.
The Freedom of Information Act request contains a specific request: “All communications with Ethereum Corporation and / or other related companies (including but not limited to ConsenSys) or individuals in the Ether ecosystem (including but not limited to Vitalik Buterin) Anthony Di Iorio, Charles Hoskinson, Mihai Alice, Amir Chetrita, Joseph Lubin, Gavin Wood and Jeffrey Wilke) or other attorneys or other persons representing Ethereum or other related companies or individuals in the Ether ecosystem, in addition to all documents including internal communications, analysis, and other materials prepared or trusted by Principal Hinman, or any other current or former department, employee or delegate to determine that Ether is unsafe, including Director Hinman’s draft statements regarding Ether and analyzes Prepared by the SEC team. ”
The request will probably lead to a large volume of items from the Commission’s documents over several years, given how long it took the Commission to make statements at all.
Timing is crucial for Ether when discussing security or goods. Ether exposure occurred many years before the SEC issued the DAO report. The DAO report was a response to the collapse of ether that invested in a decentralized independent organization, and it was the SEC announcement in 2017 that some cryptocurrencies are securities.
In recent years, there has been great confusion about whether the original coin offer qualifies as security. It is important to note that Bitcoin, which has never undergone a preparation before sale, is never mentioned in these conversations. However, the Securities and Exchange Commission did not handle the shipment. But in December, the panel sued Ripple in a landmark case alleging that the sale of Ripple Labs XRP represented an ongoing sale of the company’s investment contracts.
In the Freedom of Information Act (FOIA) request, Ripple is particularly inclined to claim that Bitcoin and Ether are under the control of mining pools in China, responding to long-standing concerns from US regulators about China’s control of digital assets. Ripple also requests the exchange of information between the committee, in particular the company’s CFO Bill Hinman, and Ethereum’s key personnel and lawyers. While it is almost inconceivable for the SEC to withdraw from its many claims that Ether is a commodity at this point in the game, Ripple’s goal seems to be to undermine the legitimacy of this decision in an attempt to strengthen the defense.
The SEC’s case against Ripple has waited a long time, and Ripple has spent considerable resources on preventing it. While XRP also leads the DAO report, the main argument is that Ripple continues to control most of the XRP market, something Ethereum, Vitalik Buterin and Joe Lubin do not, for example.
Following the announcement from the Securities and Exchange Commission, the price of XRP fell, and many US stock exchanges took the sign off the list.