Ripple’s XRP is sure in a bearish grip, amid legal battles with the U.S. Securities and Exchange Commission.
At the time of writing this report, XRP was trading at $0.40482 down 30.01% on the day. It was the largest one-day percentage loss since March 12.
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Ripple and its top executives were accused by the U.S. Securities regulators of deceiving crypto investors about the status of XRP, the world’s third-largest cryptocurrency by market value, in selling over $1 billion of the crypto assets without approval from the U.S. Securities and Exchange Commission.
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According to the SEC’s complaint, Christian Larsen, the company’s co-founder, Executive Chairman of its board, and former CEO; and Bradley Garlinghouse, the company’s current CEO, raised capital to finance the company’s business.
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- The complaint alleges that Ripple raised funds, beginning in 2013, through the sale of digital assets known as XRP in unregistered security offering to investors in the U.S. and worldwide.
- Ripple also allegedly distributed billions of XRP in exchange for non-cash consideration, such as labor and market-making services.
- According to the complaint, in addition to structuring and promoting the XRP sales used to finance the company’s business, Larsen and Garlinghouse also affected personal unregistered sales of XRP totaling approximately $600 million.
- The complaint alleges that the defendants failed to register their offers and sales of XRP or satisfy an exemption from registration, in violation of the registration provisions of the federal securities laws.
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The U.S. Securities regulators had some time ago warned that crypto companies raising funds through the sale of crypto assets must adhere to federal securities laws.