According to Western media reports, Ripple Labs - the official name of the company behind XRP and xCurrent - have become participants in another judicial investigation on suspicion of securities fraud.
Due to the fact that Ripple owns a huge amount of XRP, many argue that XRP fits the characteristics of a security, which in turn means that Ripple is involved in securities fraud. Of course, most of us don't think XRP is a security, but that hasn't stopped people from trying to get good compensation from Ripple Labs.
According to the Next Web:“In the latest lawsuit, dated June 27, a private XRP investor alleges that Ripple Labs Inc. and its CEO Bradley Garlinghouse personally have illegally profited from the rise in the price of XRP all along. The court documents specifically point to Ripple's decision to deposit $55 billion of XRP tokens in order to ensure the stability of the overall supply. This move was presented as a necessary measure to reassure investors that there will be no sudden huge sales of tokens, but instead the company will sell them calmly and measuredly.”
This is bad news for Ripple, and it may affect the price of XRP in the coming days and weeks. In general, the application of security characteristics may reflect poorly on XRP. One reason is that Coinbase does not list securities, and XRP would benefit from listing Coinbase.
As such lawsuits emerge, some kind of decision will need to be made. If the authorities believe that XRP is a security, then Ripple will be in deep trouble. In addition, this news may also make investors worried. While we do not believe that XRP is a security, we do not know what evidence the prosecution may present, so we cannot predict the court's decision.
In the current realities, it is becoming increasingly fashionable to sue Ripple. The sooner the authorities and regulators decide whether this token has or does not have the characteristics of a security, the better it will be for everyone.
According to cryptodaily.co.uk
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