The SEC’s lawsuit against Ripple could spell trouble for other crypto firms and digital assets, said Brad Garlinghouse, CEO of the California-based blockchain company.
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Ripple has spent 8 years working tirelessly to build an incredible company transforming global payments. Our mission doesn’t stop! Here’s what I sent to employees yesterday + our lawyers’ reaction to today’s SEC filing. https://t.co/wGHW4hCW2T
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— Brad Garlinghouse (@bgarlinghouse) December 23, 2020
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In a message to Ripple staff, Garlinghouse called the regulator’s actions a ‘horrendous precedent for the entire industry and any company dealing with digital assets’.
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‘Yes, the suit names Ripple, Chris [Larsen] and me, but this is an attack on crypto in a broader sense […] The snowball effect starts here; this is bad news for any market maker, exchanges like Coinbase, and so on’, the CEO said.
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According to him, Ripple has always worked in partnership with regulators and stressed that there is no clear regulatory framework for the crypto industry in the United States. Alongside the excessive scrutiny by American authorities this has led to the Ripple co-founder Chris Larsen‘s relocation of Ripple’s office to a more friendly jurisdiction.
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Garlinghouse noted that the XRP token is not an ‘investment contract’, since its holders are not tied to the company itself. The coin’s market value does not correlate with Ripple’s actions, unlike securities.
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‘Our company has shareholders; if you want to invest in Ripple, you are buying not XRP, but Ripple’s stock’, the CEO added.
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He pledged to defend this position in court and protect the company.
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Support for Ripple came from Binance’s CEO Changpeng Zhao. He urged to be ‘decentralised, but not divided’.
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Let’s be decentralized, but not divided. Let’s help each other to grow the industry. #BTC, #ETH, #XRP, #BNB https://t.co/2jQZ48a12x
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— CZ Binance (@cz_binance) December 22, 2020
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Earlier, institutional digital asset platform OSL paused XRP trading until further notice, citing the SEC’s actions.
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Please note: In light of US Securities & Exchange Commission’s enforcement action against Ripple Labs & 2 of its executives, we have suspended all #XRP payment in and trading services on the OSL platform, effective immediately and until further notice.https://t.co/EXJJEHMawn
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— OSL (@osldotcom) December 23, 2020
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Over the last 24 hours, XRP has slumped 36.1%. As of writing, the token was trading around $0.31.
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As reported on December 23, the SEC filed suit against Ripple, Brad Garlinghouse and Chris Larsen. The agency contends that the company sold unregistered securities in the form of tokens.
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