Written by Andrew Button at The Motley Fool Canada
Last week, a new development occurred in the SEC vs. Ripple Labs lawsuit, when the defendant drafted a motion to have the SEC sanctioned for “manipulation.”
Here is the background story:
The SEC recently asked a witness, Dr. Albert Metz, to write an opinion on whether Ripple Labs manipulated XRP(CRYPTO: XRP) price. Dr. Metz, a former US Department of Justice official, concluded that Ripple’s public statements had “influenced” the price of XRP. While Metz’s conclusion isn’t a “gun-proof” proving XRP is a security, it might add corroborative evidence to the SEC case if cleared by the court.
Ripple has none of that. In a scathing letter, she demanded that the Metz report be excluded from the trial. The letter argues that the SEC “failed to make the necessary disclosure under Federal Rule of Civil Procedure 26(a).” Therefore, argues Ripple, the evidence it contains is not admissible. If Ripple wins this motion, it will have accrued another procedural victory that could give it leverage to settle with favorable terms.
Ripple accuses the SEC of “manipulation“
Ripple has long taken a hostile stance toward plaintiffs in the SEC lawsuit. Accusing them of being biased, he argued that the whole affair was based on false premises. Ripple continued his harsh words with his latest motion. In his letter he said, “a continuation [of the SEC’s motion] would reward the SEC for its acumen and further prejudice defendants. » Harsh words that indicate that Ripple plans to fight this one to the bitter end.
Will this benefit XRP holders?
As we have seen, Ripple Labs is aggressively fighting the SEC in court. The question is whether this is relevant for XRP holders.
He is. In fact, it is potentially important for the entire cryptocurrency industry.
Although cryptocurrencies are decentralized, they actually depend on the support of organizations. Ripple Labs is responsible for maintaining the Ripple blockchain, developing RippleNet, and advertising XRP. All of these behind-the-scenes tasks are helping to drive demand for the XRP token. For example, when Ripple Labs recruits a company to accept XRP as a payment option, it may generate more XRP transactions than would otherwise occur. This in turn can boost demand for the XRP token. It can also lead to good publicity. All of these factors can ultimately drive up the price of XRP.
A loss in the SEC lawsuit would put all of that in jeopardy. The plaintiffs want Ripple Labs to pay $1.3 billion plus interest. Such massive financial liability could create a drain on the organization, hampering its ability to focus on tasks that support XRP. If Ripple wins, it won’t have to worry about this liability, nor about compliance with securities regulations. Thus, it will be freer to make XRP the best possible token.
The same goes for the entire crypto market. If the SEC wins, it will establish case law forcing the Ethereum Foundation and others to register their tokens as securities. This would impose heavy financial and administrative burdens on them. So if Ripple wins, Ether investors and others would likely benefit indirectly.
Ripple message gets serious, demands SEC SANCTIONED! appeared first on The Motley Fool Canada.
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Foolish contributor Andrew Button has no position on any of the stocks mentioned. The Motley Fool owns and recommends Ethereum.