Faced with losses after the Securities and Exchange Commission declared XRP to be a security, the XRP community is petitioning the US government to declare it a currency.
We the people…
On Dec. 29, a petition on the US White House web site appeared regarding the fate of the Ripple Labs token XRP. The appeal asked the government to stand by a Financial Crimes Enforcement Network (FinCEN) determination that XRP is a currency.
At the time this report was published, about 10,000 people had signed the petition. To move forward, the petition needs 90,002 signatories.
Supporters launched the petition in response to a Dec. 23 action by the Securities and Exchange Commission (SEC). The SEC charged Ripple Labs executives for selling unregistered securities (namely, XRP). Such sales totaled $1.3 billion, according to the charges.
Waves of Ripples
There are more than just charges that current CEO Christian Larsen and former CEO Brad Garlinghouse set up Ripple to sell XRP. The SEC also accuses the two of unregistered sales of XRP totaling about $600 million.
Garlinghouse announced the impending charges on Dec. 22, and staunchly defended his view that XRP was under attack for non-fundamental reasons. He pointed to the fact that Ripple had been operating on the market for eight years. Furthermore, he questioned the timing and motivation of the move. The SEC taking action in the last days of the Trump administration left the Biden administration holding the bag for the mess.
Local storm or global event?
The SEC action sent shock waves through the XRP community despite Garlinghouse’s warning. US-based exchanges began to promptly remove or suspend XRP from their trading platforms. Not all of these suspensions are in effect immediately. Coinbase, for example, will suspend trading on Jan. 19. Bitstamp halts trading and deposits on Jan. 8.
Outside of the US, life for XRP holders continues. Australia’s BTC Markets exchange tweeted on Dec. 31 that for now, they will continue to list the token.
Status quo for now
If they agree, the next step for Ripple, Garlinghouse, and Larsen will take place on Feb. 15. The Southern District of New York (SDNY) district court is pro forma offering the parties to move the case to a magistrate court instead. If they refuse, though, SDNY will hold a phone-in pretrial conference on Feb. 22.
On Dec. 29, Ripple Labs posted a comment on its website regarding the developments. In it, the team notes that most of its business is outside of the US. They also noted that XRP is legally traded outside of the US. Furthermore, there is ‘legal clarity’ regarding XRP in the UK, Japan, Singapore, and Switzerland.
Ripple’s team also looks forward to working with the new team at SEC. As they note, many of the top SEC staff left recently. This includes the chairman, division directors, the SEC’s Chief Economist and its General Counsel.