Third lawsuit for Ripple: Ripple CEO faces another blow from the US regulatory
Ripple is not having a good year so far, as it gets the third lawsuit for security frauds. The lawsuit was filed against Ripple Inc, XRPII LLC, & CEO Bradley Glaringhouse. A 28-page class action lawsuit states that XRP is security that is issued, maintained and supported by RIpple is not at all in compliance with US regulatory laws. While ripple has been working really hard to stay away from controversies and non-compliance of XRP with the regulatory laws.
Robbins Arroyo LLP managing partner, Brian J. Robbins filed the lawsuit against Ripple Labs Inc, XRPII LLC, and CEO Bradley Garlinghouse. The lawsuit filed was on behalf of San Diego senior David Oconer.
Furthermore, the lawsuit was signed by fax in late June in San Mateo, California superior court. With more two dozen pages talking about how Ripple is non-compliant with US regulatory laws and the Howey test.
Oconer and his legal team shared their views on how Ripple manipulated price of XRP. Ripple is suspected to include tens of millions of XRP tokens into an third-party custody to create a scarcity and hence increasing the price.
Furthermore, the worried long-term investors are got signaled by this event that the company would not dumb the whole lot all at once. Such moves lead to XRP mooning, as per the allegations in the lawsuit.
Since May this year, it has been the third lawsuit filed against the company, with the common theme of non-compliance with the US regulatory laws. This also tells us that Ripple is indistinguishably managing XRP itself. Which is in contradiction to what Ripple CEO Bradley said that Ripple and XRP are two different entities not affecting each other in any way.
However, the latest lawsuit filed by Oconer focuses more on violation of the Howey test. Ripple is not taking these lawsuits lightly, which is evident as the company has hired two former US securities and exchange commision big names Andrew Ceresney & Mary Jo White as lead consultant amidst all this.
XRP has been in controversies since its inception and its story of origin also plays a part in all this chaos. While leading cryptocurrencies were created from scratch or mined to generate more cryptocurrencies.
On the other hand, XRP appeared out of nowhere and more than 60% of the tokens are held by the parent company, Ripple. With all this, if there is a security breach, the company would be asked to cease the trading. Which would let the holders have a chance to get the refund out the holdings that the parent company has.
Let’s see what Ripple has in the future. Let us know in the comment section of what you think of Ripple in this case.