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Ripple's regulatory troubles |Why is XRP facing severe dumping

Quick glance: In this post, we attempt to decode the ongoing tussle between Ripple and the SEC. This episode was filed into a lawsuit on December 2020. But the events that led to this lawsuit date back 2 years.

Case Summary:
SEC filed a case against Ripple which is one of the largest crypto issuing companies.
The SEC filed a lawsuit against Ripple over its XRP cryptocurrency, alleging that the company held a $1.3 billion unregistered securities offering. The suit contends that Ripple should fall under SEC regulations because it is a security, not a currency.
The case was filed on 5 Dec 2020. The SEC had been investigating Ripple for almost 2 years prior to filing the case.

→The suit also alleges that Ripple was aware that it wasn’t likely XRP would qualify for status as a currency under the Exchange Act because it lacked the backing of a central government.

→In response to the SEC lawsuit, Ripple said that the U.S. regulator is incorrect — Ripple’s XRP cryptocurrency is not a security. The company said XRP is a virtual coin used as a medium of exchange for international and domestic transactions. Ripple further added that XRP is an asset that is perfect for payment processing because it’s quick and scalable.

→Ripple alleges that the SEC’s move “amounts to picking winners and losers” in the field, as fellow cryptocurrencies like bitcoin and Ether have not been subjected to such regulations.

→Coinbase stopped trading in XRP earlier this year after the SEC suit came down due to which we saw a major downtrend in the price of XRP.

→On 21/5/2021 Ripple filed the case to end with summary judgement after they filed a “lack of due process and fair notice” stating the fact that SEC had 2 years to prepare the evidence and along with the 6 months the case has been active.

→This month, Ripple sought the SEC’s “policies governing SEC employees’ trading in, or purchase or sale of, Digital Assets and/or Virtual Currencies, including all changes and updates to those policies.”
The SEC blatantly refuted this request with the SEC arguing that they were irrelevant to the litigation and would “not lead to the discovery of any relevant evidence.” But Ripple stated that the policies could reveal the SEC’s stance on digital assets — including any distinctions it draws between XRP and other cryptocurrencies, such as BTC and ETH.

→The presiding judge has ordered the SEC to submit these documents citing them as relevant.

Possible conclusions and their respective impacts:

→ If Ripple wins: We can see XRP becoming another major crypto. If Ripple wins then coinbase could start trading XRP again and we can see a major bullish trend. This jump could also give the crypto industry a major boost and may stabilize the market. This could also give a chance to Dogecoin to follow similar footsteps and become a mainstream trading crypto currency. This win could bring some stabilization into the current volatile market and bring even more people into the crypto world.

→ If SEC wins: This might be bad news and may open flood gates for SEC to regulate the crypto market even more which could reduce the freedom that people associate with cryptocurrency. SEC has never regulated any other crypto before this and winning this motion could give them a green light to go after other currencies as well which is bad news especially considering the current volatility of the market and this major news can break the crypto world.

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