Over the past few years, a class-action lawsuit has been linked against Ripple Labs, San Francisco-based fintech company, known in the cryptocurrency sector for XRP involvement. Unfortunately, it has not been able to escape the case of a federal judge, potentially threatening its intention to sell its stake in the near future.
Ripple Labs office headquarters
Ripple seems to can not shake off the case group XRP
According to a report from Bloomberg published on February 26, a federal judge of the Northern District of California approved the lawsuit, accusing Ripple of distributing unregistered securities (related to XRP) by giving issuing suspicious advertisements, against the company.
Remarkably, not all against Ripple, the judge dismissed claims that fintech startups made false claims under California law, were at the center of the debate, even though the court was giving the Application to prove his misconduct.
The ruling came shortly after the company argued that the lawsuit was untimely because it was filed after the cryptocurrency was offered to investors years ago, in early 2013.
The lawyer said this cIt can be intimidating come IPO plan
One of the discussions that received the most attention was whether XRP was considered a security, commodity (like Bitcoin and ETH) or something else.
While Ripple CEO Brad Garlinghouse came to the conclusion – he said that “It is clear that XRP is not a security, the UK and other countries think so” – Securities and Exchange Commission The United States (SEC) has not yet made a decision on this issue.
1 / As a defendant in the class action lawsuit, I won't get into the details (response from Ripple is coming soon). I will say: SEC guidance isn't issued by the Commission and is haven't law, rule or regulation. Apparently clear XRP is not a security and the UK and others have said as much.
– Brad Garlinghouse (@bgarlinghouse) August 27, 2019
According to Jake Chervinsky, legal advisor of the Defi Compound application, this case could delay Ripple's IPO plans.
In a commentary on how the aforementioned ruling will affect the “XRP is securities” issue, he explained:
“The SEC's execution is slow in the best of circumstances and can be kept until the case is over.”
I completely agree with Arturo.
Except, also warned strongly against assuming, “The SEC would have taken action by now if it thought XRP was a security.” SEC enforcement moves slowly under the best of circumstances & may be on hold until this case wraps up:https://t.co/KuQKksxf30
– Jake Chervinsky (@jchervinsky) February 27, 2020
To prove his point, he cited a Twitter topic in which he said that the lawsuit in California is forcing the SEC to stay out of the XRP case and its position in this nascent asset class. due to “limited resources of crypto”.
Public announcements carry more weight than private discussions.
I'm not accusing anyone of lying. I'm sure Ripple's thinking about an IPO (like many Series Cs). I just doubt it'll happen while XRP's security status remains uncertain. That's not "FUD," originally basic business sense.
– Jake Chervinsky (@jchervinsky) January 25, 2020
As for why this would slow down Ripple's IPO effort, in January, Chervinsky explained that he “doubted an IPO would happen when the” XRP is a security “situation was uncertain. That's not FUD, it's basic business consciousness.
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