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A disgruntled XRP investor filed a class action against Ripple, alleging that the company violated the United States. United and the state. securities regulation by selling the symbol to the general public.
The lawsuit, which also appoints Ripple CEO Brad Garlinghouse, argues that Ripple has essentially conducted an "endless ICO" that should be classified as an unrecorded securities offer as defined by both US Securities. Act and the California Corporations Code.
"The defendants have since gained massive profits by quietly selling this XRP to the general public, in what is essentially an uninterrupted initial offer of coins (" ICO "), claims the lawsuit. Increase the demand for XRP, and thus increase the profits that it can pull by selling XRP, Ripple Labs has always described XRP as a good investment, relayed optimistic price forecasts, and confused the customers. Company of Ripple Labs with XRP. "
Ryan Coffey, the lead plaintiff in the case, claims that he bought 650 XRP on January 6, 2018, while the token was trading at $ 2.60. Less than two weeks later, on January 18, he sold the entire stake for USD 1,105 in USDT (a USD-based token created by Tether), generating a net loss of $ 551 – or 32% – due price fluctuations between USD and USDT.
However, the case was brought on behalf of all XRP investors who purchased tokens after January 1, 2013.
The case was filed by the Taylor-Copeland Law, a California-based law firm that specializes in blockchain-related business and cryptocurrency.
As the NCC reported, the Securities and Exchange Commission (SEC) has opened surveys in dozens of ICOs to determine whether they constitute unregistered securities offerings, and US regulators have scheduled a meeting next Monday to discuss these cryptocurrences. category as well.
Gary Gensler, former chairman of the Commodity Futures Trading Commission, recently stated that he would classify XRP as "non-compliant title" because of its centralized distribution model.
However, Ripple executives have long argued that XRP is exempt from this classification, and the company further says that it has not yet been served with the lawsuit.
"We saw the tweet of the lawyer about a complaint filed recently but that was not served. Like any civil procedure, we will assess merit or lack of merit. Timely allegations, "said Tom Channick, Ripple's chief communications officer, told NCC in a statement." Whether or not XRP is a security, it's up to the SEC to decide. We continue to believe that XRP should not be classified as security. "
Currently, XRP is valued at $ 0.90, giving it an outstanding market capitalization of $ 35.4 billion and making it the world's third largest cryptocurrency.
Featured image from Shutterstock.
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