With the value of the XRP cryptocurrency going down after a lawsuit against Ripple Labs Inc., Indian exchanges have chosen to monitor the situation rather than restrict trading. The US regulator, the Securities and Exchange Commission (SEC), filed a lawsuit against cryptocurrency platform Ripple, its CEO, and its chairman for illegally selling $ 1.3 billion in unregistered securities.
Siddharth Menon, chief operating officer and co-founder of WazirX India’s largest cryptocurrency exchange by volume, described the lawsuit against Ripple as a shocking incident. He said XRP was one of the most popular crypto assets in India, and as such, the token was among the top trading cryptocurrencies on WazirX. “Given the uncertainty of this situation, we will continue to monitor process development and then take the necessary step.” Neeraj Khandelwal, Co-Founder of CoinDCX Cryptocurrency Exchange, said they are closely following developments and are waiting for more information on the issue before making a decision.
SEC claims that XRP is more of a security than a currency. The SEC said failure to register the XRP sales or qualify for a registration exemption is in violation of federal securities law. “Issuers wishing to take advantage of a public offering, including access to retail investors, broad distribution and a secondary trading market, must comply with federal securities laws that require the registration of offers unless an exception to registration is implied” said Stephaine Avakian, director of the SEC’s enforcement division. “We claim that Ripple, Larsen and Garlinghouse have failed to register the ongoing supply and sale of billions of XRP to retail investors, which provides potential buyers with adequate information about the business of XRP and Ripple, as well as other important long-term protections that are fundamental to our robustness Importance are withheld from the public market system. “
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Bradley Garlinghouse, CEO of Ripple, described the case as an “attack on crypto as a whole”. He told CNN that the SEC was fundamentally wrong on legal and factual grounds. “The SEC has approved XRP as a currency for over eight years, and we are questioning the motivation to file this lawsuit just days before the change in administration.” Michael Kellogg, attorney for Ripple, pointed out that other branches of the US government have designated XRP as a currency and therefore fall outside the scope of securities law.
The lawsuit has had a negative impact on the cryptocurrency as XRP has lost up to a third of its value. The token fell to its lowest level since November 20th.
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