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Ripple, amidst mounting legal challenges, faces a pivotal moment as its CEO’s statements about XRP come under intense scrutiny in court. In addition, a U.S. Court Judge also questions the security status of XRP, potentially impacting the XRP community’s sentiment.
Notably, the outcome of the ongoing lawsuit could potentially redefine XRP’s regulatory classification and impact its standing in the cryptocurrency market.
<h2 id="ripple-xrp-under-pressure">Ripple &amp; XRP Under Pressure</h2>
Ripple Labs, led by CEO <a href="https://coingape.com/ripple-ceo-hints-massive-pro-crypto-funding-us-presidential-election/" target="_blank" rel="noopener noreferrer nofollow">Brad Garlinghouse</a>, is embroiled in a legal battle. Notably, Ripple’s legal hurdle centered on allegations of Garlinghouse’s “misleading” statements regarding XRP’s nature and Garlinghouse’s personal investment stance.
Besides, the lawsuit, proceeding to trial after <a href="https://coingape.com/ripple-lawsuit-referred-to-magistrate-judge-for-settlement/" target="_blank" rel="noopener noreferrer nofollow">U.S. District Court Judge Phyllis</a> Hamilton denied Ripple’s summary judgment request, focuses on whether XRP qualifies as a security under U.S. securities laws.
Meanwhile, the pivotal issue revolves around Garlinghouse’s 2017 interview statement claiming he was “very, very long” on XRP. However, in the same period, he allegedly sold a substantial amount of the token.
Besides, the lawsuit’s trajectory hinges on whether XRP purchasers reasonably expected profits based on <a rel="noopener noreferrer nofollow" href="https://www.courtlistener.com/docket/8150354/419/in-re-ripple-labs-inc-litigation/" target="_blank">Ripple’s promotional efforts</a>. It marks a critical criterion in determining XRP’s security status under the Howey test.
Despite Ripple’s arguments citing a prior ruling of <a href="https://coingape.com/pro-xrp-lawyer-slams-judge-torres-interpretation-odl-sales/" target="_blank" rel="noopener noreferrer nofollow">Judge Analisa Torres</a>, Judge Hamilton maintained that XRP could potentially meet the definition of security when sold to retail investors.
Also Read: <a href="https://coingape.com/xrp-price-250m-xrp-transfer-via-ripple-sparks-speculation-whats-next/" target="_blank" rel="noopener noreferrer nofollow">250M XRP Transfer Via Ripple Sparks Speculation, What’s Next?</a>
<h2 id="what-s-next">What’s Next?</h2>
The outcome of this legal dispute carries significant implications not only for Ripple but also for the broader <a href="https://coingape.com/glossary/cryptocurrency/" target="_blank" rel="noopener noreferrer nofollow">cryptocurrency</a> landscape. A determination that XRP is indeed a security could subject Ripple to stringent regulatory requirements, potentially impacting its operations and market dynamics.
Besides, the decision may set a precedent for how other cryptocurrencies are evaluated under U.S. securities laws, influencing investor confidence and market behavior. However, <a href="https://coingape.com/ripple-clo-uncovers-key-grey-area-in-secs-u-turn-on-ethereum-probe/" target="_blank" rel="noopener noreferrer nofollow">Ripple’s Chief Legal Officer</a>, Stuart Alderoty, emphasized the dismissal of several claims while acknowledging the remaining state law claim to be addressed during the trial.
As the legal proceedings unfold, stakeholders across the cryptocurrency industry are closely monitoring the developments. Notably, amid the legal woes, <a href="https://coingape.com/price/xrp/" target="_blank" rel="noopener noreferrer nofollow">XRP price</a> fell nearly 2% today and dipped below the $0.49 mark, reflecting increasing tensions in the crypto market.
According to CoinGlass data, XRP futures Open Interest fell 1.13% to $559.59 million, while the XRP Options Open Interest rose 15.02% to $290.99K.
Also Read: <a href="https://coingape.com/solana-co-founder-makes-interesting-remark-as-uber-competitor-goes-on-chain/" target="_blank" rel="noopener noreferrer nofollow">Solana Co-founder Makes Interesting Remark As Uber Competitor Goes On-chain</a>
The post <a href="https://coingape.com/ripple-promotion-under-scrutiny-xrp-security-status-under-threat/" rel="noopener noreferrer nofollow">Ripple’s Promotion Under Scrutiny, Is XRP Security Status Under Threat?</a> appeared first on <a href="https://coingape.com" rel="noopener noreferrer nofollow">CoinGape</a>.

Ripple’s Promotion Under Scrutiny, Is XRP Security Status Under Threat?

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Coingape News Media

Інші статті, опубліковані 21 черв. 2024 р.

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