The US Securities and Exchange Commission (SEC) is about to file a lawsuit against Ripple for violating investor protection laws when selling XRP.
SEC Chairman Jay Clayton on the eve of leaving the department decided to start legal proceedings with the company and its leaders. According to The Wall Street Journal, the pending lawsuit is based on the fact that since 2012, Ripple has been illegally selling XRP. The regulator believes that the distributed digital assets are securities that should have been registered in the SEC.
In addition to the company itself, the Commission also plans to sue its CEO Brad Garlinghouse and co-founder Chris Larsen. Representatives of Ripple call the filed suit unfounded and are ready to defend their point of view in the meeting room. The Treasury, the Department of Justice and the US Financial Crimes Agency actually recognized XRP as a virtual currency back in 2015.
Ripple awaits lawsuit from SEC for illegal sale of XRP
During 2018-2019, some investors have already filed lawsuits against Ripple for the issue of unregistered securities and false advertising. Recently the company also announced plans to change jurisdiction due to many regulatory obstacles and pressure from US regulators.
This news had a noticeable negative impact on the market. Per day XRP price fell by 17.7%.
text: Ivan Malichenko, photo: CNBC