In a shocking move that has forced cryptocurrency markets to move lower, the U.S. Securities and Exchange Commission (SEC) on June 5 sued Binance, the world’s largest cryptocurrency exchange, is accusing them of 13 charges, one of which allegedly facilitates the trading of unregistered securities.
Topping the list, according to the regulator, was Binance reportedly allowing trading of several crypto assets, including BNB, the platform’s native currency; ADA of Cardano; and MATIC, the token preparing the Polygon ecosystem.
XRP No Security?
The SEC did not mention payments company Ripple, the native currency of the XRP Ledger, a platform on which the company bases its flagship products. The two entities have been embroiled in a legal battle since late 2020, when the regulator accused the payment company of selling an unregistered security, XRP.
It should be noted that despite the regulator’s listing of XRP, the price of the coin is lower and weighed down by the market-wide collapse that has so far wiped billions in value from the total crypto market cap. according to to CoinMarketCap (CMC), a coin tracker.
As I wrote on June 5, the total cryptocurrency market cap had dropped more than 5% to $1.09 trillion. During this time, the XRP price is down 7% in the past 24 hours.
However, if we compare its current performance to how XRP performed last week, the coin is alone in the green territory, adding 3%. This means that XRP has outperformed all of the top 10 cryptocurrencies, including Ethereum and Bitcoin.
The SEC’s failure to name XRP in their lawsuit could be a huge boost for the token and its ecosystem in the coming days and weeks. Especially given the current case.
Ripple supporters remain bullish despite SEC allegations
The case is still pending, but statements have been made in recent weeks that have made XRP supporters optimistic. The presiding judge has denied SEC’s request to seal the Hinman documents.
While the SEC vigorously campaigned for these documents to be kept private, claiming they were deliberative and privileged, the judge said the public had a right to know as they are relevant to the case.
These documents are critical to the case, as they detail the SEC’s internal communications on how they classified XRP as a security.
Still, the judge has yet to rule, though the SEC filed an amended complaint against Ripple in March 2023, alleging they engaged in market manipulation. Ripple has since filed a motion to dismiss the regulator’s amended complaint, saying it is “unfounded.”
Feature image from Canva, chart from TradingView