What Was the Story of Ripple’s Legal Battle?
The battle between Ripple and SEC started on December 2020, when the Securities and Exchange Commission (SEC) filed a lawsuit against the Ripple Lab and its executives with the claim that what they provide is security.
Generally, cryptocurrencies are not considered a security. If they become security, they will fall under the regulation of securities laws, which require issuers, intermediaries, and platforms to register with the relevant authorities and disclose certain information to the public, such as financial statements and risk factors.
Furthermore, being a security would limit a cryptocurrency’s ability to innovate and compete in the global crypto market. Accordingly, no cryptocurrency platform would like to become a security due to these limitations, especially Ripple!
Based on the “Howey test”, a four-pronged test that is used to determine whether an asset is a security or not; the SEC claimed that XRP tokens are securities and the company has sold them without registration and security contract. Although it was expected to be completed by December 2022, it took longer for the court to decide upon this subject, and finally on July 13, 2023, citing the Howey test, the court disagreed with many parts of the SEC’s reasoning as to why Ripple is a security, including the fact that Ripple made no promises to secondary market buyers, which is the case with most tradable products.
This news sounded like a bombshell in the digital currency market. As a result, there were surprising changes in the price of this token.
What happened to XRP’s Price?
When SEC sued Ripple in 2020, the XRP price dropped to $0.22 per coin. This news impacted the price of this token and made it go up and down several times. Obviously, many investors awaited the court’s decision to make a better decision about this digital currency. Although it took three years, the result was good for XRP because soon after the rule of the judge about XRP not being security, its price surged %96 and reached as high as $0.93, which was the highest level since March 2022.
It has been recorded that some crypto exchanges have experienced internment issues due to the high demand for buying XRP tokens. You can buy XRP easily and quickly on Blocktrade.
Ripple’s case is not over yet, and the date of the next hearing will be announced after the legal formalities. So, while investors around the world may be celebrating Ripple’s rising price, there are still many troubling uncertainties surrounding the case. However, the demand for XRP tokens might get higher when more people read the price predictions of XRP after the case is finished.
One thing that we always mention about the price of cryptocurrencies is that anything can affect it. The good news and bad news, even rumors should be considered at the time of buying a cryptocurrency. As you can see, in the case of Ripple, it took three years for the price to set a record and rise. The predictions also show the possibility of a higher price for this token.
That’s why most investors are in a rush to buy XRP at this moment. Therefore, as we always recommend, when you put your step into the world of cryptocurrency, you should follow all the news about the token you buy because it can give ideas about when is the right time to buy a crypto and when is the best time to sell.