XRP currency value plunges after US Securities and Exchange Commission sues Ripple Lab.
A US lawsuit filed against Ripple Lab Inc, the world’s third-largest cryptocurrency issuer, has caused a major decline of more than 40% in the value of XRP currency, but Indian exchanges have abstained from limiting its trading but are carefully observing the case. The XRP token fell to the lowest since November 20, wiping out last month’s 177% gain.
US Securities and Exchange Commission (SEC) sued both the founder Christian Larsen and current CEO Bradley Garlinghouse of technology company Ripple for raising more than $1.3 billion by selling their cryptocurrency XRP through an unregistered digital asset security offering. SEC case argues that XRP is more of a security than a currency and thus the issuer should have attained prior approval from the US Securities regulator before launching it.
Ripple claimed in a blog post that XRP is currently the third-largest cryptocurrency and is also a currency like Bitcoin and Ether. The company said that the Justice Department and the Treasury Department’s Financial Crimes Enforcement Network, which are major branches of the US government have already established that XRP is a currency.
The cryptocurrency industry has been growing vastly in the past few years and the SEC and other regulatory bodies have had challenges to classify and monitor them.