Ripple Labs has released a statement on the U.S. Securities and Exchange Commission’s lawsuit against the firm, alleging it sold $1.3 billion worth of XRP, which is seen as an unregistered security.
In the statement, Ripple said that the SEC’s decision to file a lawsuit against the firm is “an attack on the entire crypto industry” in the United States, and added the firm sees “a dangerous lack of regulatory clarity for crypto in the U.S.”
It adds that the lawsuit “has already affected countless innocent XRP retail holders with no connection to Ripple.” It adds it “muddied the waters for exchanges, market makers, and traders.”
The SEC has introduced more uncertainty into the market, actively harming the community they’re supposed to protect. It’s no surprise that some market participants are reacting conservatively as a result.
Ripple added it will “continue to operate and support all products and customers in the U.S. and globally.” The majority of its customers and XRP trading volume, it adds, are outside of the United States and there are clear “rules of the road for using XRP in the UK, Japan, Switzerland, and Singapore for example.”
The company further stated that it will defend itself and look forward to “setting this matter in court to finally get clarity for the U.S. crypto industry.” At the end of the statement, it reinforced its commitment to “constructive regulatory engagement.”
As reported, the lawsuit against Ripple alleges the firm paid cryptocurrency exchanges to permit “the buying and selling of XRP” on their platforms. Per The Wall Street Journal, at the heart of the lawsuit is whether XRP is a security that should have been registered with the regulator or not.
As Ripple did not register XRP as a securities offering, the regulator argues investors did not have adequate information, and as such the defendants had an unfair advantage.
XRP, the agency has argued, has existed almost wholly as a speculative asset and not a currency, with it being marketed and sold as a speculative asset. The regulator wants the defendants to pay back some of their gains and financial penalties, and to prohibit them from selling cryptoasset securities.
Since the lawsuit was filed the price of XRP has plunged from over $0.6 to $0.21 at press time, bouncing back from a low of $0.18.
Featured image via Pixabay.