According to former US lawyer and EvernodeXRPL co-founder, Scott Chamberlain, the main obstacle preventing XRP’s price from surging is the SEC’s claim that the token constitutes a security. Conversely, Ripple, the coin’s issuer, maintains that XRP is a commodity.
- In a recent tweet, Chamberlain stated that XRP’s price suppression is not caused by the SEC’s allegation that Ripple sold assets worth over $1 billion in 2013, but by the regulator’s “crucial distinction” that the token is a security, risking the entire chain.
I think a crucial distinction is SEC has alleged “XRP is a security” so the entire chain is threatened. If they only alleged Ripple sold XRP as part of an Investment Contract then there would be no threat, no price suppression – and no case because it would have settled long ago
— Scott Chamberlain (@scotty2ten) April 6, 2023
- Financial expert Fredo Ayala recently tweeted that up to 5 million people depend on the outcome of the Ripple-SEC litigation, as they have invested in XRP and are hoping for a possible price expansion.
- The legal battle began in 2020 when the watchdog accused Ripple of raising substantial funds through the sale of XRP tokens in an unregistered security offering to investors in 2013.
- Ripple executives have consistently argued that the coin should be considered a commodity. Chief Technology Officer David Schwartz recently explained, “XRP is a raw good that trades in commerce, and one XRP is treated as equivalent to every other XRP. That’s pretty much the definition of a ‘commodity.’ No part of XRP’s value comes from anyone else’s legal obligations to XRP holders.”
For his part, SEC Chairman Gary Gensler stated that the only digital asset the agency will classify only as a commodity is Bitcoin.
- Despite the lawsuit’s uncertain outcome and lengthy process, XRP’s value has recently increased by 34%, trading at around $0.51 compared to figures from 30 days ago.