The news that Ripple would be sued caused XRP investors to start the day very badly. It is not yet clear that the US financial regulator SEC will sue Ripple, but Ripple’s CEO’s statement in this direction raises the possibilities. So how high is the probability that XRP will be declared a security in such a case?
Ripple still in a securities deadlock
In fact, the announcement of XRP, launched by Ripple, as a security, has been a rumor in the backstage for a long time. A class action was previously filed by individual investors against Ripple and its managers, and the lawsuit is still pending.
It has been confirmed that Bitcoin and Ether are not securities by the US regulators themselves. However, the relationship between XRP and Ripple makes things quite difficult for the third largest cryptocurrency. With the news coming, XRP, which lost nearly 20% in value in a short time, could take another blow with the opening of the case.
The statement of the manager of Coin Center, a non-profit cryptocurrency industry-focused research institution, further broke the hopes of investors who expected positive results from the lawsuit.
How likely is it that XRP will be declared a security?
Coin Center manager Jerry Brito responded to a question on the subject with a tweet. In the relevant post, Brito stated that they have prepared posts explaining why BTC and ETH are not securities, but that no similar post will be found for Ripple (XRP). The Coin Center executive stated that “they have nothing to say” about XRP not being a security.
Here is a post where we argue Bitcoin is not a security:https://t.co/RA3Ka4Mu6m
Here is a post where we argue Ethereum is not a security:https://t.co/GTxWe4ppjQ
You won't find a similar post for Ripple. We have nothing to say about it.
— Jerry Brito (@jerrybrito) December 22, 2020
Hopes for XRP not completely exhausted
Of course, there were also names who made statements against this. Equidity Capital, a Twitter user, listed individuals and institutions who emphasized that XRP is not a security:
Who says XRP is NOT a security?
– Japan’s FCA
– UK’s FSB
– US FinCEN
– US former CFTC Chair
– Former SEC enforcement Michael Didiuk
– G20 regulators
– SEC’s Clayton wakes up from a stuper to sue Ripple for being a security?
Thanks again 2020
— equidity capital (@khughbreslin) December 22, 2020
In previous years, financial regulators of Japan and England made a statement that XRP was not a security. In his response to the SEC, Ripple’s CEO also emphasized that Japan’s financial regulator does not see XRP as a security.
While it is not yet clear whether the case will be opened, the only thing that is clear is that the war will be very difficult in such a situation.