Coinbase and other exchanges are pressurized about delisting XRP from their platforms after the US Securities and Exchange Commission decided to sue Ripple for selling unregistered securities, but let’s read more about it in today’s Coinbase news.
US-based crypto exchanges will now have to consider whether to delist XRP in light of the SEC lawsuit alleging that it is unregistered security issued by Ripple Labs to raise funds. the leading exchange among all these is Coinbase which in addition to the other consideration around XRP is also seeking SEC approval to take the public of the shares and allow retail investors to trade them so if the SEC prevails in the lawsuit, XRP will have to be classified as security meaning that the US law entities offering for trading have to register as securities exchanges.
It’s also possible the SEC wins and could destroy XRP’s value because the regulator wants to prevent the asset from selling any more tokens and for the company and its CEO Brad Garlinghouse and Chairman Chris Larsen to disgorge the profits and to pay civil penalties. Some exchanges and market makers have already started delisting XRP or exiting positions and transactions with the asset and it could be a simple question for bigger exchanges. Anthony Tu-Sekine, a partner at the law company Seward $ Kissel LLP explained:
“They can continue to list XRP based on their previous analysis that XRP is not a security, with the hope that a court will find that XRP is not a security. Or they can take ‘remedial’ actions such as restricting trading for wallets held by U.S. persons, or take it off their exchange altogether.”
This is among the reasons why Coinbase and other exchanges are pressurized into making a decision but that these scenarios are most likely covered by the exchanges’ terms of policies as he said. Exchanges like Coinbase will be crazy not to consider delisting the coin and Gabriel Shapiro also explained:
“They have to think – including just from a business perspective but also legal – what kind of precedent they’re setting. If they delist one [cryptocurrency] just because a regulator accuses it of being a security, what happens the next time that happens? Have you just given the SEC the right to delist anything from your platform just because [it makes] an accusation?”
DC Forecasts is a leader in many crypto news categories, striving for the highest journalistic standards and abiding by a strict set of editorial policies. If you are interested to offer your expertise or contribute to our news website, feel free to contact us at [email protected]