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  1. I haven't posted an update on ODL traffic for some time, here's an update. Please note that I am only able to infer ODL traffic based on 'on-ledger' transactions - if there is ODL traffic that occurs soley on a single exchange, such as USD-EUR or USD-XRP-EUR or the reverse, then I do not capture it. The last time I posted anything about ODL traffic was when ripple made the switch from large treasury transactions to smaller payments. The switchover is clear from the quarterly totals of ODL traffic as you can see in this plot - there is a huge drop between Q2 and Q3 2020. December is just getting started, and hopefully you can see that Q4 2020 is already as large as Q3, so we should be looking at reasonable growth by the end of the year (maybe as much as 25% up compared to Q3). Quarterly traffic - Please note that the currency labels are guesses - the assumption that bitstamp->bitso traffic is USD->MXN may not be true as bitso now trade other currencies, but since I am only looking at ledger traffic, I cannot be sure of the source/dest currencies - so the colour bars should simply tell you that corridors exist in those areas - the fact that USD/MXN exists in multiple bars is simply due to the fact that multiple wallets/tags operate between bitstamp/bitso regularly. Weekly traffic looks like this you can see that after the switchover in traffic in early june, there has been a gradual but slow rise in traffic that fluctuates randomly - no doubt due to both fiat and xrp exchange rate and volatility. It is encouraging to see that traffic is still gradually increasing with a noticeable uptick over the last month or two. Daily traffic looks like this You can see a little more fine structure on the daily rates, with the weekend drops and recent rise in mon-fri transactions. Here's a close up view of June 2020 onwards There is a big drop last week for thanksgiving in the USA, but apart from that you can see daily rates are doing well and gradually rising - weekend traffic seems to be rising slightly as well. Total ODL volume and 2 week average looks as follows, here, in blue I've added the XRP price - just so you can see that there is no correlation at all between ODL volume and xrp price. I had wondered at the start of 2020 when ODL volume picked up sharply, and price rose for a couple of weeks, that perhaps there might have been some effect, but it is clear from the rest of this year, that speculative activity dwarfs all other effects. My favourite plot for looking at activity is this one What you see in the above 5 plots are the ODL traffic in bands of value, 10USD->100USD, then 100-1000, 1000-10000 and so on. The top 10-100 chart shows a steady slow climb in activity over the last year - the total amount is still a pittance, since even thousands of transfers per day, doesn't amount to millions in value, but the trend is up in a steady fashion. Someone is making regular, but small, remittance payments and gradually building up. The second 100-1000 plot is quite interesting - here we can see a gradual uptrend, superimposed onto random noise and a signal that looks like a monthly cycle, where payments are peaking with a periodic frequency of around a month. The peaks and troughs appear to shift slightly - so we're not seeing a regular end of month payday triggering remittances - but it may nonetheless be an affect caused by paypackets being received monthly - with remittances being sent when convenient (depending on day of week relative to the end of month etc etc). In plots 3 and 4, you can clearly see the transition between treasury payments and smaller remittances where the traffic shifts from plot 4, to plot 3, but there is a gradual move back to plot 4 over the last few weeks as the payment amounts are creeping slowly up again. So far we still only have a handful of corridors open, so total volume is low, but if and when more corridors come online, things ought to pick up noticeably and will show up. I hope we don't have to wait another year to see more traffic.
    66 points
  2. This brings us to the latest development from the hearing yesterday regarding the SEC's request to access Brad/Chris's bank accounts as part of discovery. The question arises as to how the hearing affects each party's case? In my view, it's too early to say - the hearing only related to discovery in front of a magistrate who is not hearing the main case. The magistrate (Judge Sarah Netburn) appeared to have little understanding of crypto and seemed unsure of the case law relating to discovery in securities cases. At one point, she referred to Ripple Labs as if it was a crypto exchange used by Brad/Chris to sell XRP and didn't know who Coinbase is (referring to them several times as "Coinbank"). Her difficulty understanding the tech and crypto in general will present problems for both sides. In this regard, Brad's lawyers (Matt Solomon) did a better job of keeping things simple. I'm not convinced about the tone and theatrical gasps of frustration but it obviously struck a chord. As for Jorge Tenreiro of the SEC, it was a bumbling, rambling, confusing, spaghetti bolognese of a presentation. His explanation of how crypto trading works and the critical importance of the bank records as a central source of truth was a masterclass on how NOT to argue a case to a crypto novice like Judge Netburn. Despite interjecting a few times, I think Netburn cut Tenreiro a lot of slack. That's something worth noting as this case proceeds - in the Kik and Telegram cases, we witnessed a similar leniency towards the SEC lawyers when they stumbled which makes sense once people remember that the SEC is starting on solid, well established, public policy grounds for pursuing these cases and the judges are there to uphold these laws and the public policy behind it. I found the twitter reaction to some of Judge Netburn's comments regarding XRP as a currency and its utility value pretty amusing and overblown. Firstly, the magistrate was only repeating what Brad's lawyers said to make sure she understood his point. But more importantly, she doesn't have a great understanding of crypto, is not involved in the hearing and will not be deciding the tricky matters of law under the Securities Act. If we get commentary like that from Judge Torres, that would be a significant development. Given Netburn's role is limited to deciding procedural matters and handling mediation (which does not decide matters of law as it is focused on finding common ground for potential settlement), I couldn't get excited about her comments. There was, in fact, something much more important said during this hearing which I'll get to below. At the end of the day, this was a small tactical skirmish. Here are my big takeaways as an XRP investor: Brad/Chris can say goodbye to "quick" resolution. Motions to dismiss won't be heard until June. They will likely be dismissed and then we go to trial another few months after that. You guys and gals know my thoughts regarding what I intend to do in the middle of a bull market while this thing drags on and on. The SEC is caught in a bind regarding ETH. Their attempt to distinguish between XRP and ETH will be something I will be watching to see if that gap closes - meaning I foresee trouble ahead for Ethereum, particularly as (i) Gary Gensler already sees the Foundation as a key central force in the development of ETH, (ii) the Foundation actively promotes ETH and (iii) the Foundation and key figures such as Joe Lubin pre-mined themselves a nice little stash of ETH which they are selling to fund the promotion of ETH. If Ripple wins however, the Foundation owes them a few beers because the SEC will think twice before pursuing Joe and the Foundation. The SEC has missed a trick by not looking at the Tetragon litigation - there is stuff filed there that has a major bearing on the SEC case. Let's see if they work it out. The biggest news: we are almost certainly on track with my assessment I linked in the above post - that the SEC is going to find a way to allow secondary market trading of XRP in the US and will distinguish between promoters of ICOs and retail investors (and probably even money makers/banks). If I'm right, watch me claim credit for calling it first on January 5th.
    42 points
  3. jag216

    My complaint to the SEC

    This is the complaint that I submitted. I'm just some nobody, but aren't we all? -- I'm writing to file a complaint against the former SEC Chairman Jay Clayton who has neglected his duty to protect retail investors by publishing a 71 page allegation against Ripple that demonstrates clear ignorance of the technology, utility and transparency that I, as an XRP holder, was able to avail myself of long before I ever purchased significant amounts of the digital asset. I first purchased XRP in July 2017, but it was a matter of circumstantial convenience. At that time it was a top tier coin by market cap and demonstrated the least volatility. Stablecoins were not yet popular in the market, and so the safest way to lock in my profits from bitcoin and litecoin were to move them into what was still called Ripple on the exchange I used. After transferring XRP between wallets I made note of the speed of transmission and looked into the company, the coin percentage distribution, but in particular I saw the advantages of the technology in terms of cost savings, energy savings, decentralization potential, transaction velocity - all of which are contributing factors to the success of the company. While the allegations put forward by the SEC suggest that XRP serves as a security - that without XRP the company Ripple could not function - this contradicts the facts: Without the technology developed by Opencoin now called the XRP Ledger, Ripple as a company could not exist. They would have no product to sell. They would have no backbone to put the flesh of ODL around. They are a software company building on an external technology framework that was gifted to them. I would never have heard of Ripple, were they not attached to this digital asset which I purchased. I have never been offered or believed that XRP was any form of share in Ripple, or that XRP provided me with any sort of voting rights or corporate interest in the company. My expectation based on the recommendation of consultants like Accenture and name dropping by global authorities like the International Monetary Fund and the Bank for International Settlements is that a technology like XRP could be adopted by the financial industry to revolutionized global payments all over the world. At the time, there was no other asset, aside from perhaps XLM, to accomplish this in the same way. I saw the vision that consultant firms projected when it came to adoption of this ledger over something like bitcoin - which has always been designed to be a form of exchange that subverted banks but also included no forms of consumer protection or payment reversal - anti-establishment to the core, and now ironically captured by the establishment. The idea that Ripple was trying to bring the efficiency of the XRP Ledger to banks was immaterial - my understanding from day one was that financial institutions could run their own validators and transaction flows if they wanted, and could do so without asking XRP for permission - which the SEC validated when they themselves looked into running a node on the XRPL. Today, I still invest in utility tokens, some of which you have deemed securities, others which you have not, but I have invested because I have tried the technology and it works, and it works as fast as Ripple or faster. Some of these tokens approach banks, others are establishing networks for high frequency microtransactions, others tackle logistics tracking, other global identification. XRP is not the fastest game in town anymore, but due to the efforts of Ripple, SBI Holdings, Flare Networks, Sologenic, Tipbot, Coil and other social and financial networks building on the XRPL platform, I am confident that the utility value of the asset will outshine speculative value. But there are faster, more advanced technologies I am also invested in as far as utility tokens go. I view it as being similar to what companies like Google and Facebook did when they started investing in private individuals information before third party sharing and reselling was restricted, or, say when Google decided to scan the entire University of Michigan library. These massive data collection investments by these corporations were done in anticipation of their future utility. No one would ever call a collection of scanned books a security that was essential to the business of Google. XRP, KIN, HOT, HBAR and other coins follow the same trajectory. These are tokenized utility fuel for the fourth industrial revolution, and I am buying gasoline before everyone owns a car. If the SEC doesn't understand this, then they are not as intelligent as the investors they claim to protect. And the action taken by Jay Clayton appears to be nothing more than a blunt object shoved in the face of XRP investors all over the country who never believed that Ripple was ANYTHING without the technology behind the XRPL. I can choose to own a piece of the profits of Ford Motor Company, or I can choose to own a piece of the electrical grid that runs the factory, the petroleum that goes into their tires, the gas that goes into their vehicles, etc. I don't own stocks! I have always believed in commodities, and that's why I own digital assets - because the technology revolution they represent is the backbone of tomorrow's innovation - regardless of what company is smart enough to adopt them. If you want to protect me, and you want to protect American innovation, deregulate the commodity itself. You don't need to ask the technologists behind the technology to provide rigorous testing benchmarks - they will do it anyway because of bragging rights and commodities are such because you can test their utility. The SEC tested the utility of the XRP Ledger, right? Did the SEC confirm the throughput numbers and volume? Did they do a technical analysis of the system? No? GOOD. Because that is the role of the CFTC. You want to regulate a commodity like a utility token, you need to have a technology team benchmark the tech. It's the CFTC that should be running a node on the XRPL - not the SEC. In closing, I feel bad for the thousands of people who were shaken out of the market by this brazen stunt - or worse, who were forced to liquidate at a realized loss due to being leveraged. I would expect legal action to be taken if the Honorable Clayton's action are demonstrated to be negligent and frivolous.
    37 points
  4. Hi, I’m not an expert but I do have a big mouth so I’ve spoken up a few times about the airdrop. Eventually I got tired of typing the same things out so here is my version of a faq on the airdrop from a holders point of view. I will update this initial post as new stuff comes to light or as I get the energy to add to, or improve on it. Suggestions welcomed unless anatomically impossible. Where should I go for information? Not here obviously. You should check this stuff out with the actual source below. I could be wrong, they might change the plan, things mightn’t work as planned. DYOR. The source themselves: https://flare.ghost.io/ https://flare.ghost.io/claiming-spark-faq/ What do I have to do? Nothing. It’s an airdrop of what might turn out to be useless tokens. But if you do want to get some of that free Spark magic Internet token thingy then you have until 11th June 2021 to claim them. There are some complications though. The first is your possible tax liability as pointed out by @cmbartley in a post in this thread. USA article here: https://www.forbes.com/sites/shehanchandrasekera/2020/12/08/spark-token-airdrop-comes-with-a-tax-bill/?sh=7d0409cc6cfe Only two groups will be eligible: people who have a XRP ledger account (ie a ‘r’ address on a paper wallet, or a LedgerNano, or ToastWallet app, or Xumm app etc) OR... anyone with XRP on any of the participating exchanges. ( https://flare.xyz/supporting-exchanges/ ) Another complication is that the date those groups will be assessed at is the 12th Dec 2020. So you must be in one of those two groups on that date to be eligible. Also there is another, different-but-related airdrop happening after the Flare go-live by a different mob and it will need you to act within a certain week probably a month after flare starts up in 2021. That’s the FlareFinance airdrop. (I may cover that a bit in this faq but later on... dunno much about it yet) So just holding XRP makes me eligible even if I haven’t done anything by the snapshot date? Yes if you are in one of the two groups I mentioned above on the 12th Dec 2020. But you must eventually claim by 11th June 2021. When is the Snapshot date? The first validated XRP ledger with a timestamp greater than or equal to 00:00 GMT on 12th December 2020. What do I do to claim? Set the messageKey field on your XRP account with the special prefix and Flare address you want the tokens to go to. Note that the XRP balance at the snapshot date (12th Dec 2020) is what matters. If you claim two months later and the account is then empty, you still get the amount that was in the snapshot. (It’s not exactly one for one but close) Sounds hard, is there an easy way? Yep, just put your XRP on a participating exchange. ( https://flare.xyz/supporting-exchanges/ ) Exchanges have risks though, and you should carefully weigh up the pros and cons before doing that. Take note especially that the air drop is going to be staged over two to three years so you will need the exchange to exist and continue participating for that period. Fortunately for those that don’t want their Zerps on an exchange, there are other easy ways. They exist because XRP community devs have taken the trouble to create the tools for you to do the setup if you self-custody your XRP. This was done by Weitse who is a well known dev in the XRP community and who created the XUMM wallet. https://flare.wietse.com/ This was done by @DevNullProd : https://www.xrpchat.com/topic/35827-flexrp-a-tool-to-setup-an-xrp-account-for-the-flare-spark-airdrop/ This was done by @xrptoolkit : https://docs.xrptoolkit.com/claim-spark-tokens How can I check that I am setup with a claim? Use an explorer to look at your account and see if the address is there. Two are below. Enter your public XRP address (the ‘r’ string) and it will show that XRP account. BIThomp: https://bithomp.com/ XRPscan: https://xrpscan.com/ @xrpscam kindly said below (so have a look at that example account and you will see the little flame icon on the set up Spark address) Look in the account details, and if it is set, you will see the Flare address. Check it’s correctly recorded the address. (The XRP scan one I had forgotten the name so @Flintstone kindly advised.) What’s this Flare thing anyway? Flare is a new network that hopes to be Etherium-but-better. It wants to utilise the XRPLedger to power smart contracts in seconds (and cheaply) as opposed to Etherium’s issues with cost and speed. So architecturally it is a second layer smart contract solution built to exist on top of the XRPLedger lower layer. At some future point it will also connect to other chains. It’s native token is Spark and that is what is being airdropped out to us to kick off the network. The distribution is going to be staged over two to three years with an initial drop of 15% and more coming monthly after that. Why are we talking about Etherium addresses then? The idea is that Etherium devs will be able to cut and paste their smart contract code directly from Etherium to Flare. That’s the way they want to lure the devs... look, your code runs faster and cheaper and the transactions are near instant. Just move it here and it will run seamlessly. To achieve that they have cloned the Etherium smart contract engine, which necessarily means that the addressing in Flare must be of the same format as Etherium. So every valid Etherium address is also a valid Flare address on that seperate network. Since the Flare wallets are not yet live, the suggestion is you create a Etherium address using a Etherium wallet (eg MEW wallet) and simply use its address and private key. It is critical that when you do that, you record the 24 word phrase that will let you rebuild the private key over in the Flare wallet when that goes live. When do I get them? The Spark that you are eligible for will be sent out over time. At the go-live of the network (sometime in first half of 2021) those who have already ‘claimed’ by setting the messageKey with their desired Flare address will have 15% of their total entitlement sent to that address. Every following month there will be a further allocation of a smaller amount. If you claim some months after the go-live then you will get all the entitlement up to that point. Eg 15% plus however many months worth. Who sends them out? Thats going to be done by a smart contract running on the Flare network. Presumably it will be fairly busy for a short while at go-live as it sends some Spark to all the eligible addresses. After that it will monitor the XRPLedger and detect any XRPLedger transactions setting the messageKey field to ‘claim’ Spark. If the messageKey is set to a valid address (including the Spark tag prefix of a 22 and whole bunch of zeroes) then it will look up the snapshot amount of XRP for that account, and then calculate the Spark entitlement (thus far,) and transfer that into the Flare address specified. What are the risks? There ARE risks any time you do anything with your XRP account. The potential risk list is very long but I will give the prominent ones after saying this... if you follow the directions (and even if you get them wrong) there is very little risk to your XRP. Apart from the Exchange risk (which is a whole topic in itself) the biggest risk is you. There is no risk from setting this messageKey field. It can’t affect your balance. If you self custody then you will be needing your secret key or needing to store a new secret key for the Flare address. Now imagine you do that carefully in big writing on a sheet of paper. While your phone is in your top pocket. Is your phone camera hacked? Are you certain? That’s the kind of thing that is a risk here... some thing you do allows a hacker to access or record your keys. But that is not likely. It’s really unlikely if you are careful. Don’t use paper? What about the risk of drive failure when that’s the only place your keys or passphrase are kept. What about the file or photo (shudder...) that you stored it with... what if that is hacked? So the normal crypto key security issues arise here, and you need to be careful, (even paranoid,) but not afraid. There is essentially no risk that the transaction you use to set the Flare address will harm your account. There is a small privacy risk if you were not intending that your Etherium transactions and your Flare and XRP transactions could be connected as being owned by one person. But that is negated by using a brand new Etherium type address instead of the one you use for storing Ether. Most of us won’t be too concerned about that I suspect... but for those that are they will need to be aware. The biggest risk of all is incorrectly using a Phished ( https://en.m.wikipedia.org/wiki/Phishing ) website to perform this task. Please only use known good links and bookmarks to access any of these tools or websites. That’s it for the first draft. I will add and update and improve(??) it over next few days.
    33 points
  5. Here's a more detailed breakdown Judge Netburn issued a ruling today addressing two motions: First, Ripple/Larsen's move to compel the SEC to supplement its responses to eleven of Ripple’s interrogatories and two of Larsen’s. Second, the SEC moves for a protective order to relieve it of the obligation to respond to 29,947 separate requests for admission. So, here's the breakdown of First Part (What Ripple wanted) Ripple's move to compel the SEC to identify “all terms of the contract that [the SEC] contend[s] created an ‘expectation of profits’” for each contract the SEC listed in response to a previous interrogatory ... GRANTED Ripple's move to compel the SEC to state whether it contends that “Bitcoin and/or Ether are securities within the meaning of Section 2 of the 1933 Securities Exchange Act.” ... GRANTED in so far as to comply with Rule 33(b)(3) Ripple's move to compel the SEC to state whether it contends that “efforts by Ripple were necessary to affect any increase in the price of XRP ... GRANTED Ripple's move to compel the SEC to identify “the enterprises/ventures in which the SEC contends XRP holders acquired a stake in by virtue of their purchase of XRP from Defendants ... GRANTED in so far as to comply with Rule 33(b)(3) Ripple's move to compel the SEC to identify “any evidence . . . that the SEC contends demonstrates that any XRP holder has or had any right, as a result of his or her purchase of XRP in the unregistered distribution of securities alleged in the Complaint, to receive any future payment directly from Ripple . . . .” ... GRANTED in so far as to comply with Rule 33(b)(3) Larsen's move to compel the SEC to say whether “the XRP Ledger was not fully functional before the start of the ongoing securities offering alleged in the Complaint,” and if that is the SEC’s contention, identify “when the SEC contends the XRP Ledger did become fully functional (if ever) and what actions or efforts resulted in making the XRP Ledger fully function.” ... DENIED, but ordered to meet and confer because the court thinks the answers are relevant, but the questions too broad. Ripple's move to compel the SEC to supplement its responses to Ripple Interrogatories Nos. 3, 7, 18, 22, 23, and 24, and to Larsen Interrogatory No. 4 ... GRANTED in so far as to comply with Rule 33(b)(3) And here is the breakdown of Second Part (What SEC wanted) Restraining order for Fourth set of RFAs ... DENIED. The SEC is ordered to authenticate documents after reasonable inquiry. Restraining order for Fifth set of RFAs ... DENIED. but not required until 30 days after ruling on Fair Notice Defense Restraining order for Sixth set of RFAs ... GRANTED ... with Judge Netburn stating about the 28,000+ RFAs: "is hard to view this stunt as anything more than theater" All in all, a Ripple win :-D edit=spelling error
    32 points
  6. Hello all, it's been a while since I've been around here. Still holding, though I have diversified a little of my holdings away from XRP. Wanted to share some thoughts on prices. Everything I say here will be founded on the age-old principle: Buy low, sell high. 1. Will XRP outperform BTC? Eventually yes. XRP/BTC is about as close to zero as you can get without being zero. Having said that, it could still drop 50% from here, and 50% from that. However if you look at the highs and lows, we are at the low. This is an absolutely terrible time to exchange XRP for BTC. In the last few years there hasn't been a worse time. If you are holding, it makes sense to continue holding here. Could we go lower? Absolutely. But there is far more room to the upside. Again if you look at XRPUSD, we are near the bottom. You don't sell near the bottom unless you need the money to pay your bills, in which case it was a bad idea to invest that in crypto. 2. Will XRP be a higher price at some point in the future? Almost certainly yes. Again, because we are at the low. Markets go up and go down. Utility aside, xrp offers smart money a way to pump and dump at the very least. At some point that will almost certainly happen. No, I'm not saying 100%. But if you look at the factors: the technology is still the same, smart contracts have been added with flare, once the SEC case is finished (it will be finished at some point, we can say that with 100% certainty) it is very likely that the xrp token will be clearly something - if it is not a security the FOMO will be unreal. I'm not even sure it can be a security, but if it is I still think it will take off like a rocket (maybe not so big) simply because of where the market is. That said, the market can still take off like a rocket even while the SEC is going on. Look at the spike we saw to 37 cents. Someone is buying that, and since we can safely assume retail traders aren't rushing in to buy the SEC shit coin, it must be someone else with deep pockets. Those people haven't stopped wanting to make money from XRP. 3. Should I buy BTC? No. No. No. When people are telling you to buy BTC on twitter, you know it's a bad time to buy. Greedy, fearful, etc etc. Buy low, sell high. You don't buy something at the ATH. That's the definition of a bad time to buy. I saw someone on twitter say your net worth should be 50% in ETH and BTC. Yeah, maybe a year ago or 5 years ago! (Again, we must remember hindsight bias here: the cognitive bias that after an event occurs, it seems obvious that that event was going to occur, when in fact at the time - e.g. when BTC was back at 3k - it wasn't obvious at all.) This person also said 'there may never be a better time to buy'. The assumption here is that it will continue to go up. A pretty bold assumption. I know XRP can only go to zero. It can't go below that. There's a whole lot of space between BTC and zero. Can it go there? Sure, why not. Will it? Probably not. But that still doesn't make it a good buy from here. Buying here means you are buying at a massive premium. Virtually everyone who bought BTC in the last week is in the red now, wondering why they put their $200 (now $150 and falling) into this crypto nonsense. 4. Should I diversify? If you must diversify, do it into coins that are low. I diversified into an alt near the bottom and am currently up about 75% on my investment. I have also bought more flare (thank you poloniex) because I think it is near the bottom. Some of you will say it could go to 1 cent. Sure, I will buy more there. You know how close 1 cent is to zero? People are currently paying 17 cents for this stuff on bitrue. We are talking about the biggest airdrop in the history of crypto, supported by every major exchange on the planet. A project that is incorporating XRP and LTC, and will almost certainly incorporate BTC at some point in the future. I'm making the fundamental argument here but really that just supports my price argument. It is lowwwwwww. Buy low, sell high. 5. Should I be sad? Sure. We have been unlucky. As someone said in another thread, without the SEC XRP would probably be well over a dollar by now, and we would all be laughing. That can still happen. But you have to assume some things or the world just doesn't make sense: so we can confidently say that: the people at Ripple don't want to go out of business, therefore they will try to get this done as quickly and painlessly (for themselves) as possible. This SEC stuff will blow over. Without Flare and the airdrop I would be way, way more sad. But Flare is exciting, plus it's free money. BTC is getting the glory right now but it is entirely possible that it went to 20k and then started dropping again. That could've easily happened. It can still drop from here (because it is at the top!). So I guess what I'm trying to say is don't kick yourself for not knowing the future and don't be too sad. Diversify if you must, but for goodness sake don't buy stuff at the ATH. If you'd bought BTC at 20k, I would've said it was a bad idea. Congrats, now you would be 100% up, in the meantime any other investment in a big alt (apart from xrp of course) would've given you a better return. Anyone who bought BTC at 20k got kinda lucky, but the risk was far too high, just as it is now. 6. Am I going to buy more XRP? Probably not unless the price drops back in the 15-10 cent range. Then it will be an absolute bargain. If it went below 10 I would buy more. Why? Because it's at the bottom. It's not going to zero and staying there. Flare has made sure of that. But at this price I'm not buying more. So in conclusion, it sucks to be at the bottom, for sure. But after being at the bottom comes the upside. We saw that before the SEC. Remember when we went to 10 cents and then it touched 90 cents on coinbase? That can happen again. I am fairly certain it will at some point in the future, we just might have to wait a while for it. Cheers all. ***Not investment advice. This post is for entertainment purposes only***
    30 points
  7. I checked the Pacer website and saw that the Answer to the SEC Complaint is to be filed with the court no later than March 5, 2021. That deadline applies to all defendants (Ripple, BG and CL). Ripple's attorney said the other day that the Answer to Complaint would be filed in the upcoming weeks so it could very well be before the deadline (usually answers aren't filed early, but in this case it likely will). Also noticed the entry of seven more attorneys on behalf of Ripple, including one MARY JO WHITE, the former SEC Chair from 2013 through 2017. It's definitely on!
    30 points
  8. Pablo

    Ripple Defence

    I need to clarify this after some more thinking about the topic and having listened to a number of different views on the issue. Just to go back to what Hellerstein said in the Kik judgement: That seems to suggest that Kin themselves were the investment contract. Hellerstein does confuse matters a bit (and contribute to my own mis-reading) when he says: However reading the judgement as a whole, Hellerstein seems less concerned with the idea that a Kin token represented an investment contract in and of itself, and more concerned that the offering and sale by Kik constituted the investment contract in relation to the "thing" called Kin. In the same way Howey allowed a finding of investment contracts in relation to commodities and assets (oranges, farms and leases, neither of which are securities in and of themselves). And maybe that's where things unravel a bit - a view develops that XRP is, itself, the security. Even for me. When Ripple or others say "XRP is not a security, it's a currency/commodity/etc" they are probably correct, but perhaps missing the point: XRP itself might not be an investment contract or security - it's the unregistered offering and sale of this thing called XRP by Ripple, Brad and Chris that will be ultimately viewed as the security offering, assuming the SEC can demonstrate common enterprise and expectation of profits based on the efforts of Ripple. If that's how this plays out - it still leads to the conclusion that the asset (XRP) could remain free to be sold on the secondary market and used by clients but that Ripple, Brad and Chris (and potentially other founders) have to end their unregistered sales. There are some positives to come out of this. The use of XRP and the XRPL by banks and FIs would now be fully opened up, especially in light of the OCC endorsement regarding the use of DLT and stablecoins. It would also eliminate the toxicity and ongoing negative press. Ripple would simply be a very good DLT software and services house specialising in the XRPL. The IPO is still on the cards and valuation becomes clearer. By necessity, this would require Ripple to down-size and focus on software, services and platforms for the XRP ecosystem in the same way Telegram and Kik did after they lost their cases. The escrow would remain in a bit of quandary although perhaps some form of structural separation - taking the escrow out of the hands of Ripple itself - might address that. It would certainly be ironic (but not surprising) if this type of pivot actually boosts the utilisation of XRP and the XRPL, opens the way for community development and ultimately, increases the price.
    30 points
  9. Everyone wants to know what the best way to earn passive income on the Flare Network is. We don't really know yet because we don't have hard numbers, but we can start to talk about strategies and fill in more details as they come out. 1) FLR Rewards - If you hold FLR on the network you can vote for FTSO data providers and earn a share of their rewards. The vote is detachable from your FLR, so your coins never leave your wallet. There's no risk (assuming the Flare Network itself works correctly); the worst that can happen if you vote for a horrible data provider is you won't earn any rewards. Rewards are distributed based on time not how many votes there are - the same reward will be split among the winners every so-many blocks whether 100 people vote or 1 million. Your slice of the pie is obviously going to be a lot bigger when it's split fewer ways, so one of the best things you can do is get in and vote as soon as the network launches. Beat the crowds and scoop up some early, big rewards payouts. 2) F-Asset Rewards - There are rewards for just holding FXRP on the Flare Network. I think, like the voting rewards, these are paid out based by releasing a set amount of FLR on a set schedule, not based on how many people hold FXRP. So the payouts will be higher in the early days when there are less FXRP holders. There should be no risk in holding FXRP, the system is designed so that you'll always be able to redeem it for XRP. But there will be fees for going back and forth between the two ledgers. You'll want to make sure that your expected rewards are greater than the fees for converting your XRP to FXRP. F-assets aren't expected to launch until several days or weeks after the network does, so you'll have some time to make a decision on what you want to do. 3) Minting F-assets - You will be able to give your FLR to an agent for them to use to mint more F-assets in exchange for a cut of the transaction fees they earn from converting to and from F-assets. There are risks in doing this because agents can be penalized and lose funds if they don't do their jobs. I suspect the system will be setup to limit the risk to ordinary people who are just putting funds into the collateral pool as much as possible, but we have to wait for the details. You should still be able to receive your FTSO rewards while providing collateral to mint F-assets. 4) Trustline - Trustline is a Dapp built on the Flare Network that aims to be kind of like a trustless bank. You will be able to deposit FLR and FXRP into the Probity Vault. Everyone's deposited funds combined will be used to collateralize a dollar stable coin, Aurei (AUR), which will be released both on Flare and the XRPL. People will be able to borrow AUR through overcollateralized loans (they have to put up more collateral than the loan they're taking out) and the people who put the funds into the vault to back AUR will get the interest that's paid on the loan. I think this is low risk - someone correct me, but I don't think you can lose money you put into the vault. Like all Dapps, your risk is if the smart contracts are coded poorly and don't work right/get hacked or if Trustline is a scam. Trustline has a novel system for determining variable interest rates based on the supply of AUR and the demands for loans. If they've only loaned out 50% of the total AUR that they've collateralized the interest rate will be 2% to encourage people to take loans, but if they've loaned out 95% the interest rate will go up to 20% to encourage people to put more funds into the vault and encourage borrowers to repay their loans. You should still receive Flare rewards while using Trustline's services. The people who deposit money into the vault will have the choice to be paid in either AUR or Trustline Credit Network (TCN) token. TCN will always be redeemable 1:1 for AUR, but it gives you a governance vote so it's expected to be valued higher than a dollar. Trustline calls this a semi-stable coin because the dollar peg gives it a price baseline that it won't go below, but there's nothing setting its upper limit. As with everything we'll have to wait for the details, but right now I see no downside to choosing to be paid in TCN over AUR. One last thing, due to popular demand Trustline is working on a way to be able to withdraw AUR without borrowing it - I don't know the details of how it will work. 5) Flare Finance - Flare Finance is another Dapp built on the Flare Network that seems like it's trying to be all the DeFi in one. I saved it for last because it's the most complicated. Like all Dapps, your risk is if the smart contracts are coded poorly and don't work right/get hacked or if Flare Finance is a scam. I think most of Flare Finance's products have additional risk. You should still receive Flare rewards while using Flare Finance's services. Flare Finance will be taking a snapshot of the ledger a month after the network launches and distributing DFLR a week after that based on how much FLR you had (you may want to pull all your FLR back into your wallet for the snapshot). DFLR is basically a coupon you'll be able to use to redeem for YFLR (yield-bearing FLR) which is Flare Finance's token that it uses within its products (as if all this Flare stuff isn't complicated enough already). FlareX - This is Flare's AMM exchange like UniSwap, SushiSwap, etc. You can put pairs of coins into liquidity pools in exchange for tokens representing your share of the pool. When you redeem the tokens, the coins you get back will include your share of whatever profits the pool made. Liquidity pools work by keeping a balanced value of each coin in the pool - that means the coins you get back will be different amounts than what you put in. If for example you put $100 worth each of FXRP and YFLR when they're both worth $1 each into a liquidity pool and FXRP stays the same but FLR doubles in price. Let's say when you redeem your share it's now worth $120 worth of each coin. That means you'll get 120 FXRP back, but only 60 YFLR. This brings up impermanent loss - with liquidity pools if the two coins diverge in price faster than the trading fees the pool earns can keep up, you can actually lose value verses just holding your coins and not participating in the pool. I think liquidity pools usually pay out best before too many people get in. You can study the existing swap sites to get an idea of the likely risks and returns. Flare Farm - This let's you stake coins in return for a yield paid in YFIN, Flare Finance's governance token. I don't know what they do with the staked funds, so I don't know exactly what the risk is. There will only be 11,000 YFIN ever minted so it seems like staking to earn YFIN may be a good investment, but on the other hand you have no idea how it will be valued. In contrast, you know your yields from Trustline will always be worth at least a dollar. You can stake your tokens from liquidity pools in addition to individual coins, so that's a nice way to earn two ways from the same coins. Flare Wrap - This wraps ERC-20 tokens from Ethereum to port them over to the Flare Network. I don't know that there's a way for us to participate in the wrapping process to make money, but it may give you an opportunity to bring Ethereum tokens over to use them in Flare Finance's other products. I'm sure there will be a fee for wrapping/unwrapping tokens and the counterparty risk if Flare Finance fails to redeem them . Flare Loans - If you're familiar with CeFi services like Nexo and Celsius, you know how these work. You put up more collateral than your loan is worth and in return you can take a loan to have access to money without spending your crypto. Unlike a credit card, you have no real risk of falling into debt - in the absolute worst case your collateral gets used to pay off your loan (but you still get to keep that Lambo or whatever you used the loan for). The real risk of these loans a flash crash where you can't either add more collateral of pay off some of the loan and your collateral gets liquidated. If the price of the coin you used as collateral then shoots back up, you've now sold at rock bottom. Loans are usually a worse interest rate than you could get from a bank if you've got good credit, but they let you extract value from your crypto without causing a tax event - just make sure to watch your LTV ratios. Flare Mutual - Flare Finance is going to be doing distributed insurance. I have no idea how this works - maybe @KarmaCoverage can chime in. Flare Mine - Flare Finance is somehow rewarding people with FLR for mining on other ledgers. I'm not a miner, I don't really get it. The Governance Pool - If you have YFIN you'll be able to stake it in the governance pool, which is a fund used to keep the yield rates across all Flare Finance products healthy. By being in this pool you can basically earn a reward if Flare Finance does really well and makes significantly higher yields than expected or really poorly and the pool's funds are loaned out to boost yield rates. That's what I know about the various passive income opportunities in Flare. I'll happily accept corrections and updates. There are a number of other projects like Handshake, Gala Games, Propy, Metaverse, and others that I'm sure I'm forgetting. I think it may be worth while to throw a little bit of money at anyone building on the Flare Network, but I don't know of any passive income opportunities that these projects offer.
    29 points
  10. I skim read it during lunch. Some of the more juicy quotes: Among other things, Ripple alleges that a wide variety of people of “ordinary intelligence,” ranging from individual purchasers of XRP, to sophisticated exchanges and broker-dealers, to the SEC’s own commissioners and senior officers, did not know that XRP was an “investment contract” and therefore a “security,” as shown by the statements and conduct of those various actors. This alone is sufficient to plead that the law and the SEC’s guidance at the time of the alleged Section 5 violation did not “give the person of ordinary intelligence a reasonable opportunity to know what is prohibited.” XRP is a virtual currency, not a security. Transactions in XRP are recorded on the XRP Ledger, which is decentralized “software code” that originated in 2011-2012, before Ripple was founded. Since the XRP Ledger was created, highly sophisticated individuals and entities worldwide — certainly people of “ordinary intelligence” — have engaged in more than 1.4 billion transactions in XRP. By late 2020, more than 200 exchanges listed XRP; several market - makers made daily transactions in XRP; independent third parties created products and applications that relied on XRP and the XRP Ledger; and countless end-users engaged in daily XRP transactions worth billions of dollars. It is a fair inference that many of these users of XRP would have acted differently if they had known that XRP was subject to the panoply of regulations imposed by the federal securities laws As the SEC’s complaint admits, as late as 2020, none of the principal market-makers who transacted in XRP was registered as a broker - dealer under the Securities Exchange. Such registration is required before engaging in exchange-trading, or market-making, of any security. It is inconceivable that every one of these well-advised, sophisticated entities knew that XRP was a security but disregarded their own obligations under the federal securities laws. Indeed, the SEC admits that one of the market-makers had previously registered as a broker - dealer — demonstrating that it was familiar with SEC registration requirements — but chose to become unregistered after December 2019, while it continued to transact in XRP. Thus, a sophisticated market-maker, with full access to the SEC’s public guidance and to skilled legal advisers, concluded that XRP was not a security. Indeed, until the SEC brought this action, the SEC itself did not consider XRP to be a security. In 2018, the SEC’s Director of Corporate Finance publicly explained, in a speech that the SEC republished on its website, that neither bitcoin nor ether was a security. Prior to this lawsuit, regulators and market participants considered XRP to be similarlysituated to bitcoin and ether, as the three market - leading cryptocurrencies.See 3 (quoting UK regulator discussing “widely known cryptoassets such as Bitcoin, Ether, and XRP” as a collective set); id. ¶ 13 (XRP’s prices were highly correlated with those of bitcoin and ether). In short, countless third parties — including market-makers and exchanges executing transactions in XRP and other digital assets, agencies of the United States and foreign governments, countless individuals, and by outward appearances even the SEC itself — had come to the judgment that XRP is not a security. Sophisticated entities that were familiar with the SEC’s registration requirements unsuccessfully sought guidance from the SEC directly, which also supports the adequacy of the pleading of Ripple’s affirmative defense that the SEC did not give fair notice of its interpretations. Here, Ripple has alleged in its answer that Ripple has never explicitly or implicitly promised profits to any XRP holder; and has no relationship at all, contractual or otherwise, with the vast majority of XRP holders today, nearly all of whom purchased XRP from third parties on the open market. What limited contracts Ripple did enter into with sophisticated institutional counterparties were not investment contracts, but standard purchase and sale agreements with no promise of efforts by Ripple or future profits. Ripple will prove this through evidence gathered in discovery. For the present motion, the Court must accept Ripple’s allegations as true. The SEC argues that it “provided guidance in the digital asset space.” But the parties sharply disagree what that guidance was, and how “a person of ordinary intelligence” would have understood it. That dispute cannot be resolved on the pleadings. Moreover, the SEC does not even attempt to argue that it provided any guidance prior to 2017. But it is seeking to hold Defendants liable for offers and sales all the way from 2013 to the present. So even if the SEC were correct — which it is not — that agency statements from 2017 to the present gave fair notice, it follows that there was not fair notice before 2017 when those statements had not yet been made. From 2017 onward, the SEC issued reports and brought enforcement actions based on the legal theory that selling digital tokens via initial coin offerings (“ICOs”) to finance the development of new cryptocurrencies constituted securities offerings. But the SEC does not allege that Ripple engaged in any ICO. At the same time the SEC was warning about ICOs, moreover, it was advising that sales of two established cryptocurrencies very similar to XRP — bitcoin and ether — were not securities. For numerous reasons, there is a genuine dispute as to whether a person of ordinary intelligence would have concluded that the SEC’s actions suggested that XRP was — or was not — a security, given the SEC’s focus on ICOs. The SEC’s cherry-picking of facts also omits repeated statements by one of its own Commissioners criticizing the agency’s public statements as inadequate and ambiguous with respect to non-ICO contexts. Taken as a whole and in context, the SEC’s past statements and actions compellingly support Ripple’s lack of fair notice defense. CONCLUSION The Court should deny the SEC’s motion to strike in its entirety. (that is literally the entire conclusion, lol)
    29 points
  11. First, the amount Jed is able to sell weekly will fluctuate. Second, the 1.5% volume is not necessarily only based on the week prior. Case in point: Starting today Jed will be able to sell more daily this week than he did last week, even though last week's volume was lower than 2 weeks ago. We don't know what formula Ripple is using to make the '1.5% of daily volume' determination, but its not simply based on "volume of the past week". If the volumes stay within the current ranges and we get multiple instances of bursts in volumes like we did 2 weeks ago, then yes within 12 months is realistic, but 4 months? I wouldn't count on it. All-in-all, volume is good. I dont know how some people would view the increase in Jed's sales as something bad. I hope the volume continues to stay high so he can unload more of his bags and deplete them sooner than later. To each their own, but I'd willingly go through another 6-12 months of price stagnation at these levels, if it means Jed will deplete his bags entirely. People seem to forget that ETH & BTC miners generate more sell pressure in their markets than Jed does for XRP. But instead of trying to convince the masses of how his sales truly aren't significant in the grand scheme of things, I'd rather just get it over with and out of the way for good. I would rather have Jed unload everything at these levels, rather than later on when/if XRP goes to double digits and beyond. So unload away Jed. Please.
    29 points
  12. Hi all, posting this here but feel free to check out the Flare club for more info (it's an open club, you don't need to join anyone can read and anyone can post). When is the network going to launch? We don't have an exact date yet but from the various announcements and estimates from the Flare team, we are expecting it to go live sometime in middle/late July (4-6 weeks from now). The network is currently undergoing security audits to make sure it won't get hacked and we all lose all our money. Where will my tokens go? As our good friend @BillyOckham explained, your FLR are kinda on 'the cloud'. They don't go anywhere. If you set up the airdrop claim with a private key that you control, then that private key is your tokens. There will be various ways to access them which will become clearer as we get closer to launch. Check this thread in the Flare club for more details/questions. If you had claims on an exchange, then the exchange should handle everything. EDIT: IMPORTANT UPDATE FOR BINANCE US USERS: "We would like to provide you with guidance to finish your submission for receiving your SPARK tokens from the Flare Network snapshot on December 11, 2020. If you haven't done so yet, please go through the following steps to complete your submission. The cutoff for submitting your information is Friday, June 18 at 5pm EST / 2pm PST." Where can I buy FLR? FLR does not exist yet because the network has not launched. You can buy IOUs from Bitrue, Poloniex, or ZB. Do some reading before you jump into the IOUs, the prices are different for a reason. Anyone claiming to have FLR tokens (not IOUS) right now is lying and/or trying to scam you. How much will the tokens be at launch? Good question. FLR IOUs are currently trading on Bitrue for $1.49 but some people believe this price is ridiculously overinflated. Be careful. My personal opinion (not financial advice) is that the tokens will launch at somewhere between 50 cents and 1 dollar. Do I need to pay tax on the airdrop? This is not tax advice, however the Flare team has said they have designed the airdrop to create little/no tax liability. The full details have not been released yet but they claim to have professional, high level tax advice to this effect. What's this about a second airdrop? One month after the network launch, there will be the snapshot for the Flare Finance airdrop. Flare Finance is not the same as Flare, it is a project building on the Flare network. The snapshot will be related to the amount of FLR you have. Yep, we are getting two airdrops for free. This is where all the hard work, sacrifice, and painful scaldings pay off. What's this FXRP thing? F-assets are part of the Flare network, and take some explaining. But we have time since the F-asset system will not go live until about 6-8 weeks after the network launches. Plenty of time to find out about it. What should I do now? If you don't know anything about Flare and you are going to receive the airdrop, then read up about Flare as much as you can. At the Flare club we have an FAQ and a bunch of threads on all kinds of topics. People are also usually on hand to answer questions.
    28 points
  13. I was participating undercover :). The trolls became too overwhelming while XRP was in the dumps, I figure its safe to come out again.
    28 points
  14. There's a very simple reason: Jed is likely one of the SEC's key informants. We can infer that from 2 key pieces of this puzzle. One obvious and one not so obvious: 1. Jed was not joined in the complaint. His sales of XRP aren't any different than those by Brad or Chris and Jed financially benefited for years from the ongoing sales. He was selling them yesterday and the day before. Technically, the SEC is obliged to end his sales of unregistered securities. That they are doing nothing about him is an obvious clue as to how the SEC views him. Informants don't need to be innocent. They only need to be useful. There is another, less obvious but more important factor suggesting he's an informant: 2. The legal advice given to Ripple that SEC touted in their complaint should never have seen the light of day. The SEC is not entitled to access those pieces of advice, cannot subpoena those documents and cannot receive them through discovery or interlocutory judgements. Those documents are protected by legal professional privilege. It's almost unprecedented to see one's own legal advice used as evidence against you. Like much of the best unvarnished legal advice, it has the potential to be extremely damaging to Ripple, Brad and Chris. Such advice is valuable to the SEC because they are using it to build their scienter argument against Brad and Chris. Without that advice, they only have circumstantial evidence and would definitely fail proving scienter. Whoever shared it intended to cause maximum damage. There is only one way the SEC could obtain these documents and use them in the complaint: if one of the recipients of the legal advice willingly shared it with the SEC. Doing that breaks privilege. Jed was the only common recipient to both pieces of advice. Jed is the only person who has shown any interest in damaging Ripple. Jed is the only party who could benefit from releasing that advice. And before anyone starts defending Jed, let's be clear: Jed personally received 2 pieces of legal advice in 2012 suggesting his sales of XRP may be viewed as a sale of unregistered securities. So what does he do? Keeps selling. Jed benefits greatly here for a few reasons: I'm betting that Jed received dispensation/immunity from the SEC to help build their case. He damages Ripple who is now, for all intents and purposes, a competitor to Stellar and IBM. And that's before we get to any personal desire for revenge. Before this is over, Jed's share of XRP and his ongoing sales is going to be revisited.
    28 points
  15. Well guys for those of you that got in late 2017, this is what the beginning of a Bull Market feels like. There will be ups and downs of course, but it will get much crazier with much higher valuations. We should have about 10-12 months of steady climbing before the parabolic run at the end. Believe it or not this move is part of the steady climb. Don't worry, alts, especially XRP will catch up and they will blast through their previous ATH's. Timing is always a problem but the market is moving exactly how I expected it would.
    27 points
  16. Wow Ripple's sledge hammer keeps coming down on SEC! Who are really the defendants now? Can SEC take their ex employees being interrogated, their internal documents being scrutinised, their inaction over regulation being made into the main focus of the case? Is settlement really be that far away?
    25 points
  17. its a humdinger of a letter https://www.crypto-law.us/wp-content/uploads/2021/04/210428_Ripple-Response-in-Opposition-to-SEC-Motion-on-Discovery.pdf So Ripple are going after SEC for using their privileged status to go beyond the law when collecting information about Ripple from overseas governments using their privileged status to not comply with the order of the court to provide discovery documents about their own internal memos and logs using their privileged status to argue that the voices 15,000 investors represented by J Deaton should not be heard using their privileged status to give ETH and BTC (XRP competitors and sponsors/employers of SEC's employees) competitive advantage SEC think they can simply play dirty, wreck the lives of the very people they are supposed to be protecting, help Chinese based competitors of XRP and act in bad faith. I wonder what the judge will say about all this at the hearing tomorrow?
    25 points
  18. Since the SEC has now confirmed in court that it has never issued an official statement that BTC and ETH are not securities, wouldn't it be prudent for US exchanges to delist those cryptocurrencies, as they did with XRP? I mean, they might be involved in selling unregistered securities, right? The SEC just said so in a court of law. It seems like the careful and cautious thing to do would be to immediately halt all trading of Bitcoin and Ethereum in the US. Luckily, the SEC has also said in court that they are not going to prosecute individuals trading XRP, that they are only interested in the sales of Ripple and the executives, so it shouldn't affect XRP. But no such pronouncement has been made in a court of law about the individual trading of BTC and ETH, so it seems wise to just put a stop to all trading until there is clarity given in a court of law.
    25 points
  19. It's been a long, emotional last few years for me in this crypto space. Having jumped in and spent a considerable amount of money buying XRP at the top, the best advice I took was to keep buying to lower my average buy in price which I've been doing for the past few years now. 2020 was a particularly difficult year having lost my father to Covid. It's been a massively emotional and devastating time for the whole family and easily the toughest time of my life. Trying to take my mind off things led me to a 1 hour stint on my PC where I just decided for some unknown reason to just throw some money at some alt coins. Bearing in mind that XRP was my only holdings up until then and considering the amount of money I was still down, I still don't know what made me buy these alts but they've all done really well for me and I've made a handsome profit. In a way, the SEC case has been a bit of a blessing in disguise. Ideally I should have sold when the SEC news hit and then re-bought. But I did triple my holdings when the price came down by buying more. Looking at my portfolio earlier today got me quite emotional and I'm glad I stuck with it, even through the toughest of times. And I'd like to thank you all for putting up with my tantrums over the past few years. Being a father of a 5 and 8 year old, the profits made will go towards trying to secure a future for my kids. I'm beginning to see the light at the end of the tunnel.
    25 points
  20. "This agreement will enable MoneyGram to utilize Ripple’s xRapid product (XRP) in foreign exchange settlement as part of the MoneyGram’s cross-border payment process." Clearly the SEC implicitly recognizes XRP as a currency necessary to settle cross border payments within xRapid. One more sliver of info that makes me wanna say: Bye bye SEC ... or ... buy buy XRP. Both work equally well.
    25 points
  21. Alluvial

    John Deaton New Video

    Everyone is naturally trying to read between the lines about this extension relating to discovery, and it's normal to do that. I am an attorney who litigates, but in arbitration, not court. Keep in mind that this is a huge case involving an extended time period with numerous witnesses and numerous expert witnesses. There is a lot on the line, and the court certainly knows that. The last thing the court wants to do is have either party prejudiced by not being able to reasonably complete discovery, and it certainly does not want a party to be able to argue on appeal that it was prejudiced by not being able to properly complete discovery. So I am not at all surprised by the court granting this extension. All that being said, sometimes what appears to be a ruling against a party is really an insight into how the court might be thinking about the merits of the case. Sometimes, for example, when my firm is litigating a case at the final arbitration hearing, the arbitrators, as the hearing progresses, begin to make rulings that seem to consistently be against our side - such as objections to evidentiary issues all going against us and in the other side's favor. What that often means, however, is that the arbitrators have pretty much decided to rule in favor of our client, and they bend over backwards to allow the other side to present their case fully and in some ways even restrict our side from presenting certain evidence if the other side objects. They do that so that the losing side doesn't have an argument on appeal that the arbitrators were unfair to the losing party, which can cause the final ruling to be vacated. I am not saying that is in play here, but it is possible to small degree. Of course, the judge has not made any final decisions, but she could be leaning. So I take this as an extremely minor positive.
    23 points
  22. Hey guys, how about a like or two, this is work.
    23 points
  23. There are actually several lawyers in the crypto space who have analysed the case extremely closely explaining how the case will likely play out. Given that these lawyers are either BTC or ETH maxis and are openly critical of Ripple, you can safely assume that they won't pull their punches. Yet I was curious and even a little bit surprised when 2 of the leading figures in this group, Gabriel Shapiro and Stephen Palley had to drop the trolling and actually think through the issues carefully. When they were done discussing, they concluded, perhaps reluctantly, that XRP would likely remain only mildly affected at the conclusion of the matter, even if Ripple and the execs fail in their defence. Here's the thread from earlier this year for the links to the interview by Laura Shin. She's another maxi, yet even she remained level-headed during this interview. Also of interest is that the trolling went on pretty hard last year and in January but I've noticed it has eased off since. Perhaps that's a sign that the case isn't going to plan for the SEC or the maxis and that Ripple is managing to put up a bit of fight. Another important factor to keep in mind that many have forgotten: the process we are watching now is NOT the hearing on the facts. It's only the pre-trial manouevering before a magistrate (Magistrate Netburn is not the trial judge, she simply helps Judge Torres prepare the case for hearing). I'm not saying they're not important steps - they're critical. But there cannot be any judgement until the case goes to hearing or the parties settle beforehand. The way things are going, settlement still looks the likely outcome. And boy, are they going the long way about it. The case has been running for 6 months. No knock-out blows and John's amicus intervention gumming up the works (fun to watch, sure, but efficient?) Why isn't Ripple settling immediately? Where's Gary Gensler to swoop in and save the day? Oh, of course: the boring reality of litigation got in the way. @HenrySeldom - I'm still waiting for your promise of the Gensler magic and quick settlement. Did you mean "quick" as measured by my lawyer's watch? Because, yeah, this case is flying! I made a call early on that Gensler couldn't just walk in and spike the case. Here's what I said back in March to explain why I thought so: Meanwhile: Has the SEC taken their foot off the gas with crypto prosecutions? Nope: https://www.sec.gov/news/press-release/2021-90 Is Gary Gensler the only one driving decision-making and policy at the SEC? Nope: https://www.bloombergquint.com/politics/sec-enforcement-chief-alex-oh-resigns-just-days-after-taking-job If Gensler spikes the Ripple case, he'll be crucified. If the SEC loses, he'll be crucified. If he settles meekly, he'll be crucified. No, the safe bet for Gary Gensler is to let the litigation run its course on its merits and make sure the optics show the SEC fighting like a deranged wildcat all the way. Now, he could use that as cover for a settlement but I suspect the settlement will need to have the appearance of being pretty tough on Ripple and the execs. Why? Because he needs the bloody, mangled heads of Brad Garlinghouse and Chris Larsen on spikes to show to Congress. And if he can't get the whole head, an ear will probably do. Cutting off an ear could sate the bloodlust in Congress for crypto but it isn't life threatening. It's not all bad. Van Gogh did some of his best work after losing one.
    23 points
  24. As of this writing, bitcoin transaction fees are $51.64. For those of you who are into patterns and cycles, the end of the last bull run coincided with fees going above $50. This is the first time it has happened since then. I have a BTC maxi friend. Genuinely curious, I asked him how people in bitcoin circles talk about high transaction fees; are they seen as a problem or not? He pointed me to this podcast interview with Michael Saylor. Luckily, the website shows a transcript of the whole thing, so you can scan through and browse at leisure. One of his main arguments for BTC seems to be that it is 'harder' than gold, meaning that it is a more reliable store of valuable than gold over a longer period of time, and therefore it is more useful. Why does the number keep going up? Because people keep putting money in. Why do people keep putting money in? Because the number keeps going up! It is a circular argument that collapses if people, for some reason, decide not to put money in. Maybe because people invent a better store of value? I mean you can't just invent a physical substance like gold, but you sure can improve and innovate on a bunch of computer code. But anyway this still doesn't solve the problem of high fees. But the argument he makes for why bitcoin is better is that it is more efficient than moving physical gold around the planet. Yes, he is using Brad's 2017 suitcase of money in an airplane trick, but instead of paper money we are now actually carrying bars of gold around to use as exchange. My friend said: "The fees are high because so many people are using it!" I then asked my friend, what do people then say about chains that have low fees no matter how much people are using them? He quoted this in response, from Saylor: I thought, hmm is no one using these other chains? It's been a long while since I checked transaction volumes so I did. There are about 3.5 times more transactions daily on the XRPL than on bitcoin. Maybe these metrics are totally wrong, maybe they don't show a bunch of btc transactions that are happening. Nevertheless it seems a bit strange to refer to altcoins with nodes across the planet, transacting billions in value, as lab experiments in a garage. Which brings me to my main point. This guy is obviously smart, a savvy businessman, successful. Does he genuinely not know what is happening in other projects in the crypto space? Like does he really think that all altcoins are just a white paper and a few moonkids passing tokens around? It's so strange. I've noticed this with my friend: he is completely oblivious to what is happening in crypto outside bitcoin. I get it though: btc is the big fish so we have to know what's going on with it, but it doesn't have to know what's going on with us. But isn't it surprising when intelligent, hard working people get things so obviously wrong? I make no secret of my dislike of bitcoin, but I'm not trying to start a fight or be snarky here. I'm genuinely confused by this. Does this guy not know? Did he do some cursory research back in 2016 about some other projects and has never checked back since? I know crypto is tribal and it's my team versus your team etc. But even in football supporters of teams like Man City or Real Madrid will at least know that other teams have some good players, even if the fans don't think they are better. But in crypto we get this. It's baffling.
    23 points
  25. 0 - 6.00 About his background 1997 live in Bay area and was a techy The Peanut manifesto at Yahoo. 6.00 when he joined Ripple was working on 3 projects - global ID project/ Smart Contract and Payments - decided to focus on payments. 8.00 Need for identity tech 9.00 Mike Arrington 10.00 He is a very private person with a sense of humour 11.30 - First encounter with crypto 2012 - conference - Bitcoin - he is long on BTC and very bullish on BTC. Only other coin he ha had a lot to deal with is File coin 14.00 SEC lawsuit - he has to dodge some questions, but SEC are wrong on the facts and wrong on the law. He is hopeful of a constructive outcome. Discovery surrounding ETH is the biggest win so far. 16.30 Jay Clayton - very clear Clayton was anti crypto. Throws around stuff about Hinman and Clayton that we all know. 18.00 Gary Gensler - much more knowledgeable about crypto Discovery will show how they do not understand 19.00 Jon Deaton - big surprise to everyone 20.00 - what would be ideal outcome? He wants closure and clarity, but there is a difference between ideal outcome and pragmatic outcome. We have clarity in countries outside the US. SEC has failed to provide clarity and tell us where the "dark line" is. How can you delist XRP and list Chain-link. How can the industry work together? Needs o reach a clear settlement. 23.30 Does Congress need to step in - yes for sure. SEC could have used a rule making process, SEC chose to use enforcement as their tool. @Court system will not solve the problems for everyone else, we need clarity through legislation. US had clarity for set up of Internet, which is why people moved their Internet business to the US. UK, Japan and Singapore are leading and have certainty 26.00 Has Ripple lost many customers mostly good new - 20 new customers etc. 90% customers are non US customers. non of the new customers are US based. Moneygram stopped, but big deal on Tranglo. 28.00 Will be leveraging ODL, still using ODL. 29.00 - are the US conversations with US on hold? Yes there is a big head wind in doing business with US companies. 30.00 what is the vision for XRP started with payments -extending these services like credit service. Talks about Amazon, and Brad uses his analogy about starting with verticals and expanding use cases like Amazon did. Ripple still growing in staff 33.30 which r banks are you working with - have to respect privacy agreements. He has seen the rumours - XRP is extremely scalable and efficient. Ripple are ina unique postion to provide central banks with services. 80% of Central Banks are actively investigating CBDCs. 36.00 Thoughts about China and US as reserve currency China are being very smart. Ripple have been successful because has a big picture with a strategy. US have fallen behind in having no strategy. 38.00 Talking with lost of governments around the world. XRP ledger is extremely efficient, and energy consumption does matter. PoW is very energy expensive. 39.30 problem of PoW not being scalable Brad is VERY BULLISH on BTC and then he rambles about saving energy in the future 41.30 Escrow - what is the plan for moving the escrow forward - burning, distribute? Some misinformation. Ripple has not interest in dumping XRP - escrow provides transparency. He is open to new ideas. 43.30 Where do you see Ripple in 3 - 5 years Internet of Value provides compelling opportunities and nothing has changed. How to leverage XRPL for other use cases. Ripple are the largest investor in crypto. 45.00 when Ripple IPO? Have to work with the SEC first. 46.00 About the crypto market in general/ Now at 2.2 trillion dollars - very positive. Money supply 25% per year will cause inflation Cannot predict short term dynamics but the big picture is that crypto market has a long way to grow. 48.30 - what is the next big thing in crypto - he dodged that question. NFTs are her to stay, tokenisation is underway. FTs took him by surprise. ore and more payments solutions. Elon Musk is interesting. 51.30 Carbon footprint - is it (BTC) a necessary evil. He is NOT trying to attack BTC - he is VERY Bullish on BTC. Powercuts in China took BTC down last week, but BTC is really good at some things. Rapid fire questions.
    23 points
  26. Personally, I really like what Deaton is doing. He's fighting the good fight. I don't care about Brad's or Chris's holdings or if they have to pay a fine. They should have done a better job at distributing XRP. Hindsight is 2020 but they could have given XRP to non profits with clauses so there's no dumping on the market. Brad and chris don't look like saints to me, and I won't defend these billionaires. Whatever. That's in the past and history will judge them for any action. John Deaton is fighting for his XRP and that affects me. I hope he dents this case and impacts it in a positive way.
    23 points
  27. Please examine "Item 8.01 Other Events." In the SEC filing between MG & Ripple. The SEC approved this!!! Actually the use of XRapid as it was called then is mentioned 5 times in this document. SEC Filing | MoneyGram International, Inc.https://ir.moneygram.com/node/20381/html
    23 points
  28. None of that would happen. Owning XRP will not give you shares in Ripple or anything else, ever. The SEC is not asking for a declaration that XRP be deemed a security. At the end of the Complaint is a section called "Prayer for Relief" which I think is a stupid name a lot of times it's called "Demand for Judgment" (which I think is better) anyway it's what the SEC wants. There are 5 things: WHEREFORE, the Commission respectfully requests that the Court enter a Final Judgment: Case 1:20-cv-10832 Document 4 Filed 12/22/20 Page 69 of 71 70 I. Permanently enjoining Defendants, and each of their respective agents, servants, employees, attorneys and other persons in active concert or participation with any of them, from violating, directly or indirectly, Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. § 77e(a), 77e(c)], including by delivering XRP to any persons or taking any other steps to effect any unregistered offer or sale of XRP; This one is basically asking that Ripple no longer sell or even transfer XRP i guess. II. Ordering Defendants to disgorge all ill-gotten gains obtained within the statute of limitations, with prejudgment interest thereon, pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. § 78u(d)(5)]; This one is asking that they pay money III. Prohibiting Defendants from participating in any offering of digital asset securities pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. § 78u(d)(5)]; This one is basically nothing because the sale of digital asset securities (if that's even a thing) is already prohibited (sale of all securities are prohibited unless registered). IV. Ordering Defendants to pay civil money penalties pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)]; and This one is again asking for money. V. Granting any other and further relief this Court may deem just and proper for the benefit of investors. This one is a big nothing that you just throw in at the end of every complaint. So basically if the SEC gets everything they ask for, Ripple will no longer be able to transfer XRP (so no more sales of XRP) I'm not entirely sure if this would completely stop ODL in the US but maybe and they are asking for money. Even if Ripple is found to have sold XRP as an unregistered security, that would not give XRP holders any rights as security holders. XRP would not give you shares in anything and certainly not shares in Ripple. Also it wouldn't mean that XRP is now a security. The SEC is not asking that XRP presently be classified as a security. So if the SEC wins after a jury trial (which will take years) I guess the following happen - Ripple probably goes bankrupt along with Brad and Chris. XRP will continue as a coin outside of the US. -Now the reality of the situation is Ripple is politically connected and the SEC is really just interested in a Pay off anyway, there is no way this doesn't settle.
    23 points
  29. I don't particularly like logarithmic charts. I think they can often be misleading, making you think a move is bigger (or smaller) than it really is, sometimes massively inflating price targets. No professional trader I have ever seen solely uses log charts, or even uses them most of the time. Maybe that is because I've mostly seen traders from forex, where price moves are significant but unlikely to wildly break historical ranges, especially in a short move. That said log charts can be very useful for certain things. The main purpose of them is to show the relatively magnitude of price movements at different levels. For example 0.01 cents to 0.1 cents might not look like much on the dollar chart, but using the log chart you can see it's the same size of move as going from 20 cents to $2. A very general, basic pattern in TA is 3 waves: impulse, correction, impulse. Again, in general, we expect the impulses to be roughly the same magnitude. Also, in general, we expect the correction to come about halfway through the whole move. I keep saying 'in general' because there is no hard and fast rule here, and you wouldn't base a trade solely on this assumption. It is used to inform other signs you might be seeing in the market. In this xrp bull run we have already seen this pattern twice. Here is the first one. You can see that the first impulse is roughly the same magnitude as the second. The wick is not important here, the body of the candle is much more important. \ Here is the second pattern, occurring on a higher timeframe. Here too if we use the bottom of the correction, we can see the move is almost the same in terms of magnitude. IF we assume that the same pattern will reoccur on the higher timeframe, and that the move from 18 cents to $2 was the first impulse, that we are now in the correction, and that we will see a similar sized impulse following it, then we end up with an XRP price of $10. Even if we come back lower and take around 70 cents as the bottom of this correction, that still leaves us with an $8.5 dollar XRP. Many of us have seen Blockchain Backer's videos, and you will know he uses the first big xrp movement as a guide for this movement. However, I am skeptical about this because I don't see a good reason to use that swing. Why does he use that one and not the 2017 one? Why doesn't he use the whole movement from the very bottom to the ATH? The movement that he uses as a reference gives us a target of aounrd $14. If we just use the last bull run then we get a target of $3. If we use the whole move from the very beginning we get a target of $120. Movements don't have to repeat themselves. However, symmetrical price moves are relatively common and make a certain amount of logical sense. However, we are talking about real money here, not just numbers on a screen. The log chart doesn't do a good job of showing the sheer magnitude of volume that is required to move xrp from say 10 dollars to 100 dollars. It may be a similar magnitude mathematically to 0.01 to 0.1, but in the real world it is not the same at all. At some point you start hitting friction like 'wow that's a lot of money' or 'wow there's not that much money available for speculation in the whole world'. Does anyone know why BCB uses that swing as his reference? If there's a good reason then I'd love to hear it. Until then though I think the assumptions that the move we are in now is a bull run and that the correction we are now seeing will be the biggest part of the run are reasonable, so I'll go with that.
    22 points
  30. Seoulite

    Guessing corrections

    OK @banistersmind I figured I'd create a new thread for this so we don't clog up the other thread with a long post. Unfortunately you've asked me to justify the hardest prediction to justify, which is how a correction will look. This is why I said it was a very rough guess. Corrections are the hardest time in the market to trade and some traders avoid them totally for that very reason. But I will go through some of the ideas that I have been studying and others I've picked up over the last few years. First a couple of key principles of the market you need to understand: 1. The market has three modes: expansion, consolidation/correction ("going sideways"), and reversal. After consolidation there is always expansion, after which there may be consolidation again or reversal. 2. Markets are fractal, meaning that all of these modes and patterns are happening all the time on every timeframe from the 1 minute chart to the monthly chart and yearly charts. This is the 1 hour chart of XRP. I am working on the assumption that we are entering a consolidation right now. This makes sense because we have just seen expansion and we have not seen a reversal. Therefore it is almost certainly consolidation. Now remember this expansion/consolidation/reversal is happening on the smaller scale too. So if we look at the 15 minute chart we get this. Since we are seeing consolidation now, the next thing we will be expansion. I am guessing that this will be to the upside but it might not be. The reason I guess it will be a bit more up is because 1. we are bullish on the higher timeframes, and 2. usually corrections will trade across a 'range'. Here's where we enter a lot of speculation: IF we are still gonna go up, the people who move the markets generally want to buy from the lower part of the range. So they drive the price lower before they push it up, so they can buy it at a lower price. This produces a 'standard' 'textbook' correction. But there is really no guarantee it will look like this at all. If we look at previous consolidations we can see the areas where the market movers are accumulating: So it's a series of interconnected assumptions and guesses, as well as a relatively textbook correction. The assumption we will go more or less 'sideways', that we will trade up and down within the range, and that the big money will want to buy from near the bottom. I could be completely wrong and we drop like a stone from here. As I said, predicting corrections is almost impossible. Hope this helps a little.
    22 points
  31. Regarding the SEC's Xmas Bomb lobbed into the crypto-sphere and its profound disruption upon the valuation and markets... The SEC either... INTENDED to cause massive losses to U.S. investors (and the World too). They were inept and didn't realize their action would precipitate such an impact as was realized. Either way, it was a MASSIVE F-up, and egregious misuse of their powers upon the very citizens they're entrusted to "protect." ALL they had to do to prevent massive harm to the investors, was include a safe-harbor declaration for the exchanges, and a clarification of the SEC's concern being limited in scope to ONLY RL's (and execs) continuing sales of their founder's tokens. There should be consequences.
    22 points
  32. https://ripple.com/wp-content/uploads/2020/12/Ripple-Wells-Submission-Summary.pdf Summary of Ripple’s Wells Submission I. Introduction A. The SEC’s theory, that XRP is an investment contract, is wrong on the facts, the law and the equities. B. To prove its case amounts to an unprecedented and ill-conceived expansion of the Howey test and the SEC’s enforcement authority against digital assets. C. The SEC’s theory that XRP is an investment contract ignores the economic reality that XRP is, and has long been, a digital asset with a fully functional ecosystem and a real use case as a bridge currency that does not rely on Ripple’s efforts for its functionality or price. D. XRP is a currency. XRP is similar to bitcoin and ether, which the SEC has determined are not securities. By alleging that Ripple’s distributions of XRP are investment contracts while maintaining that bitcoin and ether are not securities, the Commission is picking virtual currency winners and losers, destroying U.S.-based, consumer-friendly innovation in the process. E. This case is distinguishable from the Initial Coin Offering (“ICO”) and/or Simple Agreements for Future Tokens (“SAFTs”) cases that the Commission has brought previously, which involved no developed ecosystem or established utility for the underlying asset, and where the tokens were sold directly to purchasers by the issuer based on promises of profits and ongoing efforts that were articulated in white papers and other forms. II. Factual Background A. XRP is a fully functional currency that offers a better alternative to bitcoin. XRP is a widely adopted digital asset based on an open-source blockchain technology, with an extremely robust, fully-functioning currency market. XRP consistently ranks among the top three virtual currencies by market capitalization—alongside bitcoin and ether, the two Chinese-controlled virtual currencies that the SEC has stated are not securities. XRP has been trading in secondary markets since 2013. The secondary market is massive—approximately $700 billion to $1 trillion in total trading volume since 2013—and operates separate and apart from Ripple. XRP is traded between fiat and other virtual currencies on more than 200 exchanges globally, the vast majority of which have no connection to Ripple whatsoever. XRP transactions take place on the XRP Ledger (“XRPL”), a decentralized, cryptographic ledger powered by a network that is not controlled or owned by any one party. The XRPL has successfully recorded hundreds of millions of transactions for over eight years without error or dispute. Through the consensus process, validators must agree on specific transactions for inclusion in the blockchain. During consensus, each server evaluates proposals from a specific set of trusted validators, or Unique Node List (“UNL”). Users are free to use any UNL they prefer and anyone can run a node or validator. Ripple does not control anywhere near a supermajority of validators and changes to the Ledger have been adopted despite Ripple’s dissent (e.g., a recent change adding virtual checks that Ripple opposed). The consensus validation process prevents any single actor from unilaterally owning or controlling the XRPL. Consensus enables XRP to serve as a faster and cheaper means of closing transactions compared to other digital assets, and largely eliminates the risk of centralized control by any one party. B. Ripple is a responsible and transparent actor. Years before the SEC’s July 2017 DAO Report, Ripple relied on expert advice and regulatory pronouncements that XRP was a virtual currency and not a security. (a) In 2015, DOJ and FinCEN settled a case with Ripple and determined that XRP was a convertible virtual currency and Ripple was a money transmitter of XRP. The settlement required Ripple’s XRP transactions to comply with laws that do not apply to securities transactions. Since 2017, around 90% of Ripple’s XRP holdings have been held in an inaccessible escrow, which Ripple voluntarily proposed and cannot unilaterally terminate. The escrow is intended to standardize the supply of XRP that could come from Ripple, even during times when the price and volumes of XRP have increased. Ripple’s On Demand Liquidity product (“ODL”) uses XRP as a bridge currency to address inefficiencies in cross-border payments, allowing for dramatic improvements over legacy payment systems. (a) Traditional cross border transfers typically take two days to complete, whereas ODL transactions complete in minutes. (b) ODL provides cost savings by freeing up capital held in correspondent bank accounts and significantly reduces transaction costs associated with remittance payments. (c) Both the International Monetary Fund (“IMF”) and the Consumer Financial Protection Bureau (“CFPB”) have recognized the consumer benefits of ODL. (d) ODL incentives were offered to develop a better experience for customers and to drive scaling and adoption of ODL. Short-term incentives are consistent with standard practices to stimulate growth in network markets. The incentives and rebates have decreased significantly since 2019. (e) Extensive data analysis shows that ODL-related announcements have not impacted the price of XRP. C. Ripple’s XRP sales were only ever a minute fraction of overall XRP trading. In the past, Ripple’s sales were mostly done through foreign market makers who brokered blind bid/ask trades on certain cryptocurrency exchanges, the vast majority of which are located outside the United States, or via OTC transactions mainly to institutional, third-party entities via contracts that did not include any promise of profits or promise to increase the price of XRP. Ripple’s sales are now limited to sales to ODL customers for use in the product. Ripple’s sales were consistently a fraction of one percent of the overall trading volume. Throughout 2018, Ripple’s XRP sales represented only 0.095% to 0.43% of the global XRP volume, and, in the first quarter of 2019, those sales amounted to 0.22% of the overall trading volume. Ripple took precautions not to impact XRP’s price and to minimize any perception that it would do so. Ripple stopped all programmatic sales and almost all OTC sales in September 2019. In May 2020, Ripple began selling XRP to customers for use in connection with ODL after fully disclosing to the SEC its intent to do so. D. XRP is used as a currency by as many as 150 third party commercial and consumer applications for a variety of purposes. E. Extensive data analysis shows that XRP’s price correlates to that of the other leading digital assets—not to Ripple’s announcements or news about its business. The data show that XRP’s price has not been impacted by Ripple’s public announcements which means the market does not believe that Ripple’s efforts translate into an increase in the price of XRP. Unlike prior ICO enforcement actions, this case will be the first time that the SEC has to refute years of trading data that fundamentally undermines its theory. III. The Howey Test. A. As a threshold matter, it would be unprecedented to bring a case against Ripple based on XRP sales that took place before the July 2017 DAO Report, especially in a case where the SEC is not alleging fraudulent conduct. B. XRP is a currency, as the DOJ and FinCEN determined in 2015. Currencies are excluded from the statutory definition of a security. Digital assets like XRP that operate as a medium of exchange, unit of account, and/or a store of value are properly categorized as currencies. XRP’s functional characteristics and longstanding utility as a replacement for fiat currency require that it be categorized as a currency and not a security. XRP trades in a robust currency market, with massive volumes of traders, the vast majority of whom have never transacted with Ripple. C. XRP does not satisfy the Howey test. 1. Before even getting to the Howey analysis, XRP is not an investment contract because there is no “contract” underlying any “investment contract.” (a) We are not aware of a single case in the more than 70 years since Howey that has found an investment contract absent a contract or privity between the buyer and seller. Here, the vast majority of XRP trading has taken place on the secondary market, wholly independent of Ripple, with no contract or privity with Ripple. 2. Ripple is not a common enterprise of XRP purchasers. (a) Horizontal commonality requires that proceeds from sales be pooled to support the investment that will result in the distribution of profits. (a) There has been no “pooling” here as required by horizontal commonality. (b) Other than a small fraction of one percent, XRP trading did not and does not involve Ripple and therefore the proceeds of those sales were not, and could not be, pooled by Ripple. (c) Ripple’s sales of XRP into the secondary market were made to purchasers who did not know from whom they were buying (and Ripple did not know to whom it was selling) and thus there was no pooling of proceeds, as required by the law. (d) The Second Circuit has rejected broad vertical commonality and has not explicitly adopted strict vertical commonality. (e) In any event, there is no vertical commonality here where the fortunes of XRP holders are demonstrably not intertwined with Ripple and its efforts, but instead hinge on independent market forces as it does here, which is overwhelmingly supported by the data. 3. There is no reasonable expectation of profits by XRP purchasers based on the efforts of Ripple. (a) Ripple does not and has not promised to increase XRP’s prices in public statements. Ripple’s overall messaging regarding XRP has been entirely consistent with that of a company that uses a currency for payment solutions. Ripple has made clear that its efforts relate to increasing the liquidity of the XRP market for ODL’s benefit and not to increase the price of XRP. (i) The SEC’s focus has been on the subjective intent of the XRP purchaser. But subjective intent does not control. Rather, courts consistently hold that the test is an objective inquiry into what the purchasers were actually offered or promised. (ii) In other words, the mere fact that a purchaser believes a party may undertake efforts to drive an asset’s value is not enough to satisfy the Howey test, especially when that other party is not obligated to act in the way that the purchaser hopes and especially when the purchaser is a downstream, secondary market participant with no relationship or privity with the other party. (b) Ripple’s interaction with the third party XRP community does not constitute “efforts of others.” (i) The XRPL’s decentralized nature precludes XRP purchasers from reasonably relying on Ripple’s efforts to increase the price of XRP. (c) Ripple’s promotion of ODL—and other products—is related to its business, not to XRP. Ripple is trying to increase demand for its products, some of which use XRP and others which do not, not the price of XRP. (i) Extensive data analysis demonstrates that XRP purchasers neither rely on Ripple’s efforts nor reasonably view XRP as an investment in Ripple. (ii) Most ODL transactions are demand-neutral (each involves the purchase and sale of the exact same amount of XRP in a short time) and therefore do not impact the price of XRP. (d) Ripple’s sales to its customers for use in ODL do not, and cannot, violate Section 5. When a purchaser is not “‘attracted solely by the prospects of a return’ on his investment . . . [but] is motivated by a desire to use or consume the item purchased . . . the securities laws do not apply.” Forman. (e) Ripple’s XRP holdings do not convert XRP into an investment contract nor do they mean that XRP holders have a right to rely on Ripple’s efforts or that any such reliance is reasonable. (i) Many entities own large amounts of commodities and participate heavily in the commodities markets—Exxon holds large quantities of oil, De Beers owns large quantities of diamonds, Bitmain and other Chinese miners own a large percentage of outstanding bitcoin. And all three have an interest that may be aligned with purchasers of the underlying asset. But no one credibly argues that those substantial holdings convert those commodities or currencies into securities. D. Information asymmetries are not part of the Howey analysis, but in any event, there are no material asymmetries between Ripple and XRP holders. 1. Ripple has been transparent about its activity in the XRP market by publishing quarterly XRP Market Reports, disclosing its incentive programs, and being incredibly transparent in other respects. 2. Extensive data analysis demonstrates that Ripple’s disclosures and press releases do not move the price of XRP, indicating the market does not consider news about Ripple material. IV. Policy reasons counsel against finding XRP to be an investment contract. A. Innovation in the cryptocurrency industry will be fully ceded to China. The Bitcoin and Ethereum blockchains are highly susceptible to Chinese control because both are subject to simple majority rule, whereas the XRPL prevents comparable centralization. B. An expansive application of Howey will have a chilling effect on the entire blockchain industry. This would make it impossible for any company to develop and promote a digital asset without running afoul of the securities laws, even where the company has never sold the asset as an investment, like Ripple. C. No foreign regulator has determined that XRP is a security. In fact just the opposite is true. The U.S. would be the unfortunate outlier.
    22 points
  33. Like many, I have read every publicly available filing ... and fatigue is starting to set in. With that said, THIS filing finally started to hit on several very major points. This quote jumped out at me as one of those: "The SEC asks this Court to accept its absurd claim that the SEC was engaged in a deliberative process over what Mr. Hinman should say in a personal speech, even though it has argued in this litigation that Mr Hinman's speech did not provide any meaningful guidance to the marketplace. Given its contention that Mr. Hinman's speech expressed his own views, the SEC cannot argue that communications about the speech were intended to facilitate agency decision making." I also liked the way Ripple's attorney's addressed the broader matters at hand on page 20. Any attorney who knows anything at all would have to concede that it is completely impossible for the SEC to prove scienter, that that aspect of the complaint (against CL & BG) should have been withdrawn, and the failure of the SEC to withdraw it is deliberate abuse of our judicial system and an egregious waste of tax payer money.
    21 points
  34. Here is a new publication from the Ministry of Education in the Kingdom of Saudi Arabia (KSA). It is part of the current High School curriculum for the entire country: Digital Technology 101. The first paragraph talks about the evolution of payment systems. Of particular note, the last sentence says “We need to be able to accept these improvements in payment processing soon.” The second paragraph gives Ripple as the example of how payment improvement is unfolding. It cites that Ripple uses the blockchain to settle payments in seconds. The third paragraph goes into cloud storage and is not terribly relevant. As a reminder, the Saudi Arabian Monetary Authority (SAMA), or central bank, started testing the XRPL in 2020. By December they announced that it didn’t pass muster primarily because it was a public ledger. That same month, Ripple announced a private ledger project for CBDCs. SAMA promptly re-visited the XRPL in January. Now it is included in the high school curriculum. Anyone want to wager that SAMA will be in the initial wave of central banks using Ripple for CBDCs? Bear in mind: I lived in the KSA for 7 years. There is intentionality behind EVERYTHING that is printed, and they literally censor words they don’t like with Sharpies. (Photo of a bottle of Grenadine that I took while shopping. The mutawa, or religious police, censor words like brandy, alcohol, etc on every product that is imported … guess they didn’t know what Triple Sec was ;-)
    21 points
  35. https://www.forbes.com/sites/roslynlayton/2021/04/08/in-the-ripple-case-the-sec-is-now-on-trial--and-knows-it/amp/?__twitter_impression=true "..... Netburn ordered the SEC to produce all communications related to XRP, bitcoin, and ether where a third party was involved, and any formal internal documents “expressing the agency’s interpretation or views” on cryptocurrency, and to deliver them to Ripple. She granted most of Ripple’s motion, which means that the discovery could be a treasure trove of embarrassing information for the SEC. This could mean game over for the SEC’s case against Ripple and more largely, a serious blow to the agency’s credibility. Other defendants will cite the SEC’s arbitrary and capricious nature. These disclosures could bring new headaches to scandal-plagued Apollo Capital Management which Clayton joined upon leaving the SEC, ostensibly to clean up the mess left by founder Leon Black and his links to Jeffrey Epstein. The timing of the lawsuit on Clayton’s last day and his subsequent hiring by a crypto-focused hedge fund are very curious coincidences. Conflict of interest concerns could also intensify for Hinman, now back at his old firm Simpson Thacher, which paid him a $1.6 million annual pension while he worked at the SEC. Hinman’s influence to the determination that ether is not a security keeps the SEC’s regulatory paws off Ethereum, the blockchain platform which Simpson Thacher supports as a member of the Ethereum Enterprise Alliance. Simpson Thatcher also handled the $100 million IPO of Canaan, the Chinese maker of machines used to mine cryptocurrency. Netburn’s order should bring much-needed transparency to the case. Gary Gensler, slated to be confirmed as the next SEC chairman, will take the helm when China is racing ahead with a closed-ledger digital currency threatening to unseat the dollar a leading medium of global exchange. It was extremely shortsighted of the SEC to handicap Ripple at a time when the US needs every American crypto leader on board to compete with China. Moreover, the case seems to reveal that former SEC leaders put their personal gain above the well-being of the nation. When the agency repeatedly claims in filings and hearings that “the SEC is not on trial here”, it is almost certain that the opposite is true."
    21 points
  36. These threads are being derailed by childish banter, could you please keep things on topic and move your chit chat elsewhere. The forum is becoming less interesting for many of us.
    21 points
  37. I've already commented in separate threads how I think the SEC case is playing out and what it means for XRP, Ripple and the broader crypto ecosystem. Some people have asked me to consolidate these posts into one thread. For my own sanity alone, I think that's a better idea. This will necessarily be sporadic depending on developments but feel free to discuss amongst yourselves in the meantime. It doesn't take much for me to give an opinion - for what it's worth! I should state openly that what I offer here is not legal advice or trading advice - it is purely provided for entertainment purposes and amusement. I am not your lawyer (lucky you!) so if you are concerned about how this case affects your investment in XRP, Flare or related projects, I strongly advise you to arrange your own legal and tax advice in your home country. Believe me, this year is going to be wild so you're going to need it. I'll start with a couple of scattered posts to give you a flavour of what to expect: Here is where I started after the lawsuit dropped in December: I had to go back and work through everything a second time and refined my thoughts in the following post - by this stage, I've made a big call regarding how this plays out for XRP and Ripple, particularly the insight that the SEC is less concerned with secondary markets of XRP and primarily focused on sales of XRP by promoters such as Brad, Chris and Ripple: My conclusion from the above post is worth repeating here: And since people ask about Jed - here are my views on why I think he avoided being prosecuted as well as an explanation of how the SEC got hold of the crucial evidence comprising of the legal advice given in 2012:
    21 points
  38. I'll take a stab at these because they are important questions - I've numbered them to simplify things: Yes - I can see a scenario where only the sales of XRP by Ripple, Brad and Chris are treated as the investment contracts while the token "XRP" is free from securities laws. That will leave XRP to be traded on the secondary market without restriction so it's entirely feasible that ODL remains a legitimate use-case in the US. Gensler did make reference to crypto exchanges potentially having to comply with securities regulations so that will be interesting to watch because it affects every token, not just XRP. What happens in that scenario? Assuming Gensler follows through, this actually makes XRP much more attractive as all lingering doubts are removed regarding the use and trade of XRP in the US. It also levels the playing field by forcing other crypto projects (Ethereum, DeFi etc) to get their house in order before operating in the US. I don't envisage any scenario where XRP or ODL ceases to be used in the US. It might affect how Ripple and Founders sell XRP and run their business (due to reduced revenue and/or increased costs of selling XRP). It will likely have a bigger impact on founders (which is fine by me - neither Brad, Chris, Jed or Arthur Britto are key employees any longer and shouldn't be permitted to sell XRP without tight controls). Gensler did emphasise in the confirmation hearing that the SEC needs to apply "technology neutral" regulatory solutions which suggests that what happens to one project needs to apply to other projects too. I'm curious to see if he squeezes the Ethereum Foundation and DeFi teams, most of which allocated themselves huge bundles of pre-mined tokens and are key drivers behind their respective projects.
    21 points
  39. Bitcoin and Ethereum developers will never want to use gradual expansion of smart contracts, high fees, and non-scaled platforms. If developers have a better, cheaper, and more scalable platform, they don't want to pay high fees. The average user will also want to use DAPP, which is fast, has low transaction fees, and is highly scalable for long-term use. This isn't noticeable if you're just sending money, but it's a difference that you'll notice when you start using the Dapp. Dapp is the same as a normal app.The general public thinks that ordinary apps and Dapps should have the same usability Flair Network uses an Ethereum virtual machine and the app code is compatible with Ethereum. BTC will also lose its position as a key currency within the flare network, which may make value preservation useless. It is the Spark holder who has the right to governance. And it's an XRP holder. I think XRP will be a key currency within the flare network. So I think it's over $ 10. Flare networks are so powerful. The network effect begins to gather on a well-capitalized platform that has removed the blockchain barrier. For example, a game console could only play one game at first, but if one game console is all compatible, all software and apps will start to gather. It is the same as the platformization that started to occur on PlayStation and NES. Bitcoin will not be able to solve problem for scalability and smartcontract and fee unless it enters the flare network, Ethereum will increase the developer burden for gradual updates, and it will be a few years before the fee will be cheaper.Ethereum 2.0 is a very difficult improvement update. It is not yet clear and complete that all ERC20 tokens will work. Now, how can both Bitcoin and Ethereum prevent developers from escaping? No, it may be difficult not to run away. If you have a platform that is easy to operate and has cheep fees or scalability, you can just switch. The flare network is already running a testnet and is working fine. All tokens included in BTC and ETH have no choice but to come to the flare network. If they don't come, other altcoins will get smart contracts and go ahead. The value of all tokens will begin to move to the flare network. This network effect works so strongly. Flair Network is also an Ethereum code compatible Dapp platform, so to speak. Ethereum Code Compatibility Dapp now runs on various blockchains. However, there is no platform that can be interoperable with the same code.and We will also get interoperability of all tokens on all blockchains. Bitcoin and Ethereum in the top three currencies do not have the same functionality as flare networks. And other currency developers will not have time to develop the same thing as the flare network. Even if you make this all-purpose platform from now on, you can't beat flare. So investors have no choice but to invest in XRP and Spark. The flare network eventually swallows all the value. It's definitely a project to watch.
    21 points
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