Class Action Lawsuit Accuses Ripple CEO of Liquidating Holdings While Touting XRP

Michael LaVere
  • Updated complaint accuses Ripple CEO Brad Garlinghouse of touting XRP while selling his own holdings.
  • Class action lawsuit was originally filed in May 2018 accusing Ripple of violating US Securities Law. 

A class-action lawsuit is accusing Ripple CEO Brad Garlinghouse of touting XRP to prospective investors while quietly liquidating his own holdings. The suit was originally filed in May 2018, alleging that Ripple had violated the US Securities Act through a 2013 initial coin offering (ICO) of XRP. 

According to court documents uploaded by CoinTelegraph, an update to the lawsuit on Wednesday included an amended complaint accusing Garlinghosue of misleading investors amidst his own sale of XRP. 

The complaint says Garlinghouse presented himself as “very, very, very long” and “on the HODL side” of XRP during 2017, despite allegedly selling 67 million of the tokens and liquidating all of his XRP from Ripple within days of receipt. 

The suit also finds fault with XRP’s creation and the 100 billion token supply. 

The complaint reads, 

The value of XRP owned by Defendants substantially exceeds the value of Ripple’s revenue or cashflow from all other sources. Ripple’s dominant value proposition are the XRP tokens it owns and sells. Ripple’s value proposition as a company depends upon the promotion of XRP, yet XRP is entirely or essentially pre-functional and purchased by investors in anticipation of profit based on the efforts of Ripple.

The plaintiffs accused Ripple and Brad Garlinghouse of misrepresenting XRP as a “bridge currency” in order to avoid being classified as a security. 

The complaint continues, 

These claims are misrepresentations and omissions of material facts to investors because the utility of XRP (or lack thereof) is pertinent to the value of XRP. Simply stated, these false claims about XRP's utility are nothing but an attempt to avoid the application of securities laws and drive demand for XRP.

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Binance Acquires Crypto Debit Card Issuer for an Undisclosed Sum

Leading cryptocurrency exchange Binance has acquired cryptocurrency debit card issuer Swipe for an undisclosed sum, in a deal that gets the platform one step closer to issuing its Binance Card.

Finance Magnates reports the firms shared revealed the companies will “work together to further mainstream adoption of cryptocurrencies,” by further bringing fiat and digital assets together. The deal will allow for cryptos to be used as a payment method in the traditional financial system.

Binance unveiled its plan to launch a Visa crypto debit card earlier this year, but was having difficulties implementing it. The acquisition of crypto start Swipe should help fix these difficulties and support the exchange in its “mission of making crypto more accessible to the masses.”

Per Binance CEO Changpeng Zhao, off-ramps are a key component to be considered in its mission. He added:

By giving users the ability to convert and spend crypto directly, and have merchants still seamlessly accept fiat, this will make the crypto experience much better for everyone.

Binance and Swipe listed each other’s native tokens as part of the deal. Binance now has trading pairs for Swipe’s SXP token, while the Binance Coin (BNB) was added to the cryptocurrencies, stablecoins, and fiat currencies available as a payment method on Swipe.

Swipe, it’s worth noting, converts cryptoassets into fiat currencies at the point of purchase. Users pay in a cryptoassets of their choice, which is then converted into fiat currency the merchant receives, so the latter does not have to manage cryptoassets, or accept payments in them directly.

Swipe’s cards are issued by Contis Financial Services, a visa Principal Member regulated by the UK’s Financial Conduct Authority. They are available in 31 countries within the European Economic Area, and support transactions in euros, pounds, U.S. dollars, Korean won, and Philippine pesos.

The firm’s CEO Joselito Lizarondo revealed partnering will Binance will “place Swipe in the position to make cryptocurrencies more accessible for millions of users worldwide.” Binance Card users will be able to get up to 4% cashback in bitcoin on their purchases, which will be available in over 50 million locations in the world.

Featured image via Pixabay.