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XRP struggles to recover due to SEC lawsuit

Major exchanges such as Binance and Coinbase suspended the trading of XRP coins, which affected the price of Ripple in the market. As of writing, its price has plummeted to more than 60% in value and is struggling to recover. However, it’s showing signs of a bullish run if it gets past the US$0.33 barrier.

In December 2020, XRP faced a lawsuit filed by the United States’ Securities and Exchange Commission due to their failure to announce the 1.3 worth of revenue from Initial Coin Offerings or ICOs.

TechCrunch’s founder, Michael Arrington lashes at the Securities and Exchange Commission (SEC) due to their unfair ruling on Ripple. He said that the Howey Test for Ripple is ‘outdated’. Additionally, he added that the test is no longer a valid method for testing digital currencies.

I think it’s all securities in the sense of, we’re all buying these things because we’re trying to get into assets that will protect us from what the dollar is doing. But no, we look at the Howey Test, the hundred-year-old test that’s absolutely useless in a modern world. It’s ridiculous,’ he said.

Meanwhile, Brad Garlinghouse, the CEO of Ripple, said that Ripple Labs is currently trying to settle the issue with the SEC.

Can’t get into specifics, but know we tried – and will continue to try [with] the new administration – to resolve this,’ stated Garlinghouse.

Additionally, Garlinghouse and fellow founder Chris Larsen said that they are hoping for a better and renewed focus on digital assets once Biden’s administration begins.

As we’ve seen, a lack of a clear regulatory framework over the last four years in the U.S. especially has left fintech and blockchain players in a state of limbo. Other countries like the UK, Switzerland, Singapore and Japan are miles ahead,’ said in a statement by Ripple Labs.

In a cryptocurrency update Twitter post, Garlinghouse said they’re ready to work with the new administration.

Congrats to Gary Gensler! We’re ready to work with SEC leadership and the broader Biden administration to chart a path forward for blockchain and crypto innovation in the US,’ greeted Garlinghouse in the tweet.

The lawsuit against Ripple was filed and is scheduled for a conference on the 22nd of February, 2021. More cryptocurrency news on Ripple is available here at Cryptoshimbun.

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