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XRP Standstill

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I thought I'd share why I believe XRP is in limbo. The SEC does not comment on the status of whether XRP should be offered as security or currency as it would be in direct conflict with the current class action lawsuit against Ripple for offering XRP without a security classification in 2013. Here is a great article shedding light on the reasons behind the lawsuit: 

https://www.theblockcrypto.com/2018/12/06/do-ripple-executives-statements-imply-that-xrp-is-a-security/

Once the lawsuit clears, the SEC might be more inclined to come forward and comment on XRP. Until then, they remain silent. The price of XRP at the moment is solely based on two factors: speculation and the value of Bitcoin. 

While XRP has the potential to have utility, Banks will not adopt or use this utility until the lawsuit is cleared. The resolution of the lawsuit will help provide the regulatory certainty they are looking for. So we wait on the US Federal courts decision. As XRP was once sold & treated like a security it now functions as a utility currency. It is for this reason the ruling isn't straight forward. However, the date the lawsuit was filed was in May of 2018 and unless they are suing based on purchases back in 2013 I can't see this lawsuit having any merit. In which case Ripple should be triumphant.

Worst case, Ripple was caught selling XRP as an unregistered security, they pay the fine and move forward as a currency/utility and should not be governed by the SEC.

Edited by Scout

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I think this is probably a fair assessment of the state of things in the US - the Federal courts will likely decide on the status of XRP and it will be binding at State level. Clearly, the story is different across the Middle East and Asia where the regulatory environment is much more amenable for XRP usage. 

I wonder if anybody can provide some insight as to how long these class action lawsuits usually take to be solved?

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8 minutes ago, Scout said:

The SEC can not comment on the status of whether XRP is a security or currency as it would be legally binding and in conflict with the current class action lawsuit against Ripple for offering XRP as a security.

I don't believe for a minute for this to be true.

The lawsuit claims that Ripple should have registered XRP with the SEC.

And that would prevent the SEC to make any statement about whether or not they consider this to be true?

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2 hours ago, lucky said:

I don't believe for a minute for this to be true.

The lawsuit claims that Ripple should have registered XRP with the SEC.

And that would prevent the SEC to make any statement about whether or not they consider this to be true?

It is true, the SEC helps govern the law. If the SEC commits to something that is contrary to the law they get in trouble. Hence why they refuse to comment.

Edited by Scout

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23 minutes ago, Scout said:

I thought I'd share why I believe XRP is in limbo. The SEC can not comment on the status of whether XRP is a security or currency as it would be legally binding and in conflict with the current class action lawsuit against Ripple for offering XRP as a security. Here is a great article shedding light on the reasons behind the lawsuit: 

https://www.theblockcrypto.com/2018/12/06/do-ripple-executives-statements-imply-that-xrp-is-a-security/

Once the lawsuit clears the SEC can come forward and comment on XRP. Until then they remain silent. The price of XRP at the moment is solely based on two things, speculation and the value of Bitcoin. 

While XRP has the potential to have utility no Banks will adopt or use this utility until the lawsuit clears providing the regulatory certainty they are looking for. So we wait for the US Federal courts to decide where XRP stands, as it was once sold & treated as a security but now functions as a utility currency. It is for this reason the ruling isn't straight forward. However, the date the lawsuit was filed was in May of 2018 and unless they are sewing based on purchases back in 2013 I can't see their case having any merit. In which case Ripple should be triumphant.

Worst case, Ripple was a security pays the price and carries forward as a currency/utility not governed by the SEC.

Sorry Buddy but you are trying to declare that the whole world is just US and SEC? This count just for US but the other countries in the world has still 7bln population which doesn’t give a sh*t about SEC.

Utility s going on in whole Asia and some other countries.

US cant be a peace maker any longer cos it terorizes all others on this earth.

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1 minute ago, Scout said:

It is true, the SEC is governed by the law. If the SEC commits to something that is contrary to the law they get sued themselves. Because they are a governing body.

These two statements are contradicting each other:

1. SEC statement is legally binding

2. SEC commits to something that is contrary to the law

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10 hours ago, XRP_Legacy said:

Sorry Buddy but you are trying to declare that the whole world is just US and SEC? This count just for US but the other countries in the world has still 7bln population which doesn’t give a sh*t about SEC.

Utility s going on in whole Asia and some other countries.

US cant be a peace maker any longer cos it terorizes all others on this earth.

The whole world does rely on the US for the classification and clarity because Ripple is headquartered in the US. Plus the SEC has an extremely long reach and have shut down businesses outside of the US. As much as you don't like to admit it, they have a big influence. Just like Ripple has a big influence on the success of driving XRP to mass adoption.

Edited by Scout

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On 12/19/2018 at 12:37 PM, Scout said:

I thought I'd share why I believe XRP is in limbo. The SEC can not comment on the status of whether XRP is a security or currency as it would be legally binding

The SEC isnt commenting, because the SEC does not make or rule on US law.

Edited by Gepster
rephrase

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5 minutes ago, Gepster said:

Whatever the SEC says is definitely not legally binding, simply because the SEC does not make or rule on US law.

Well I'm pretty sure if the SEC stated something that wasn't in line with the law they would get into trouble and apparently this has happened before.

Edited by Scout

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the SEC cannot make XRP tokens a security! they can make OFFERINGS a security transaction, that's all

e.g. they COULD fine or prosecute ripple for OFFERING XRP at a given time for certain reasons

they cannot rule on XRP in general as a digital asset, bc even if they could (they can't!), it wouldn't matter bc XRP just carries on globally as it is

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52 minutes ago, Scout said:

It is true, the SEC is governed by the law. If the SEC commits to something that is contrary to the law they get fined themselves. They are a governing body and are suppose to uphold the law not trump existing laws. Hence why they refuse to comment.

It isn't true though mate. No regulation hinges on extant lawsuits. If that were true, we could have a parade of vexatious complainants (as these ones are) holding Ripple down eternally. That won't be allowed to happen, as the current lawsuits could take a year or more to finalise. 

At any one point large companies are constantly fighting in courts; it doesn't stop them going about their business.

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48 minutes ago, Scout said:

The Whole world does rely on the US for the classification and clarity of XRP because Ripple is headquartered in the US. Plus the SEC has an extremely long reach and have shut down businesses outside of the US. As much as you don't like to admit it, they have a big influence. Just like Ripple has a big influence on the success of driving XRP to mass adoption.

XRP is a decentralised open source digital asset. It does not matter where Ripple is headquartered.

Which is also the reason XRP is not a security to begin with.

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5 minutes ago, lucky said:

XRP is a decentralised open source digital asset. It does not matter where Ripple is headquartered.

Which is also the reason XRP is not a security to begin with.

But what does matter is if Ripple isn't driving XRP's utility we can expect the price point to remain where it is. The price we are witnessing is not from use cases and volume but of holders and traders.

Edited by Scout

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Regulators regulate, courts adjudicate...precedence is binding...all the while, legislators can legislate, which supersedes legal precedence, but then the courts can be asked to interpret the legislation...if the courts interpret the law in a manner inconsistent with the legislators intention, they are free to change the law.

The SEC could make a determination at any time, which the courts may chose to enforce or change...and legislators can decide to change or clarify the law, from which regulation flows...

That's the framework...in practice, it get murkier and various interested parties can inform the process at multiple levels...any guess as to why the SEC has not yet taken a position is exactly that, a guess...but to say they can't take a position because there are court cases outstanding is not accurate, though in practice that may in fact inform their decision to wait.

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