A US federal court ruled in favor of Ripple on Thursday. For several years now, the SEC has labeled most cryptocurrencies as securities. So, stocks, bonds, etc. argued that it should be faced with similar regulations such as But Thursday’s decision has boosted investor confidence in XRP, making it rise strong. So, how will this important event affect the entire industry? Crypto expert Lawrence Mike Woriji seeks to answer this question.
Ripple’s XRP is back on cryptocurrency exchanges
cryptocoin.comCoinbase announced on Thursday that it will relist XRP following the court’s decision. The crypto exchange wrote in a tweet:
Our XRP-USD trading pair is now in full trading mode on Coinbase Exchange, Coinbase Pro and Advanced Trade. Limit, market and stop orders are all available now.
Crypto exchange Kraken has also relisted XRP for its US customers. In addition, crypto exchange Gemini has announced that it will consider making XRP available for both spot and derivatives trading.
Interestingly, Bitstamp became one of the first companies to continue trading XRP after the decision. Bitstamp tweeted, “Good news for XRP traders! We have resumed trading digital assets for our US customers! Bitstamp was one of the first exchanges to list XRP in 2017. We are now one of the first exchanges to continue trading in the US,” he said.
On the other hand, with a market cap of $41.6 billion, XRP is currently the fourth largest cryptocurrency by market cap, after Bitcoin, Ethereum, and Tether’s USDT. The resurgence of XRP on major exchanges is a positive sign, especially for token holders.
Effects of Ripple’s victory on other crypto exchanges
Now, let’s look at what this decision means for other crypto exchanges like Binance and Coinbase. Last month, the SEC sued two of the largest cryptocurrency exchanges, Coinbase and Binance, for misleading the public by promoting unregistered securities.
But Thursday’s decision sets a precedent for crypto companies to defend themselves. However, this does not mean a complete victory for the crypto industry. Because, Judge Torres found Ripple guilty of violating securities law by selling XRP to institutional investors such as hedge funds. Also, the Ripple decision does not mean that crypto firms like Binance and Coinbase have an edge over the SEC. Judges in both cases will have to decide whether the sale of cryptocurrencies on both exchanges qualifies as securities, as the SEC claims.
No more lawsuits, but regulation will continue
While the potential inconvenience of requiring retail-facing crypto companies to register or change their business model could be avoided due to Thursday’s decision, there are still other factors at play. As we know, most cryptocurrency projects offer early token sales to institutional investors and venture capitalists. These sales are often pre-registered with regulators to avoid potential impacts.
However, the SEC listed these examples as reasons why the tokens might fall under its jurisdiction. Many on the SEC’s list of potential securities have made such sales. Thursday’s decision could spell the end of such pre-funding, except that VCs choose to buy on the public market, where prices are volatile. It would be fair to say that Thursday’s decision did not provide much clarity for the entire industry. And the Ripple and SEC lawsuit is not over yet.
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