In what might have been the most anticipated court decision by the crypto world, Judge Torres has ruled that XRP is not a security. The price of XRP shot up immediately after the ruling came out. Currently, the coin is trading at $0.598 which is a 27% increase.
The lawsuit against Ripple had gone on for years. The U.S Securities and Exchanges Commission (SEC) had accused Ripple CEO and founder Brad Garlinghouse of selling XRP coins in a security fashion, but not obeying regulations governing securities.
The SEC took the matter to court and took it upon themselves to prove that XRP was actually security. The lawsuit went on for over two years. The US court has partially denied the SEC’s motion against the crypto asset.
This decision is a landmark and could potentially change how governments, banking institutions and even multinational conglomerates approach cryptocurrencies. The judge also ruled that the institutional sales of the XRP cryptocurrency occurred in the fashion of security.
U.S Court rule XRP is not a security
According to the verdict, the SEC accused Ripple of selling $728.9 million worth of XRP over the span of 7 years(from 2013 to 2020) to institutions such as hedge funds and ODL customers. Furthermore, SEC alleges that Ripple also sold $757.6 million worth of XRP to individual investors through crypto exchanges during the same period. Pursuant to these sales, and on the grounds that XRP was sold as a security, SEC went ahead to file for a lawsuit on December 22, 2020.
The price of the cryptocurrency burst 30% in one long green candle as many investors rush in to buy expecting a larger move in the days to come.
The Ripple case verdict was greatly awaited as many expected it to happen this year for a number of reasons. The majority of Ripple supporters expected it to happen as early as March, however, due to the arduous process of the justice department, the verdict came out later.