Ripple (XRP) Officially Responded to SEC Lawsuit, But Exchanges Fear the SEC Win the Case

Ripple (XRP) Officially Responded to SEC Lawsuit, But Exchanges Fear the SEC Win the Case

Source: Cryptoonliner

Ripple has prepared an official response to the accusations of the US Securities and Exchange Commission, SEC.

In the document of about 100 pages, the word ‘denies’ is used 440 times. All the denials refer to the SEC’s claim that XRP is unregistered security that Ripple was selling illegally. It is noted in the document:

– Ripple denies it engaged in any offering of securities; denies the inaccurate characterization of the legal advice Ripple received regarding XRP; and denies that it engaged in a single ‘offering ’of XRP.

The company’s lawyers do not in principle recognize the use of the term “offering” in relation to how Ripple sold and distributed its token. According to Ripple, the characteristics of the XRP token make it incompatible with traditional securities regulation. At the same time, if to apply this regulation to XRP by force, this will negatively affect it as a cryptocurrency.

The document also provides information that no regulator in the world has required XRP transactions to be regulated as securities. Ripple has hundreds of partnerships around the world, including Latin America, Southeast Asia, and Australia. And regulators in these countries did not view the XRP token as a security. The very attempt at such regulation is incompatible with XRP’s functionality and liquidity. Trying to regulate XRP as security will eliminate its main utility, which is cheap and instant cross-border transactions. If XRP is valued as security, this will lead to destructive regulation of exchanges and the entire cryptocurrency industry.

Earlier, Jesse Powell, CEO of the Kraken exchange, said that the SEC lawsuit poses a threat to cryptocurrency exchanges. Powell tweeted:

– Judges tend to side with agencies. If XRP is found to be a security, the SEC would say that exchanges should have known. Safe harbor pending outcome would have been responsible if only purpose is to ‘test.’

Ripple CEO Brad Garlinghouse also stressed that the SEC lawsuit leads to confusion and legal battles that will harm both exchanges and users.