In the US, pressure is growing on crypto exchange Coinbase to relist Ripple (XRP). The argument: the SEC, which is suing Ripple, is not responsible for secondary markets. But Coinbase remained cautious.
Ripple (XRP) has shone over the past few weeks with a small rally and turned over the past month a good 30 percent into the plus. But those who wanted to profit from the trend as investors in the U.S. looked down the tube. Since the U.S. Securities and Exchange Commission sued Ripple over XRP in December 2020, the altcoin is no longer represented on legal crypto exchanges in North America. U.S. market leader Coinbase listed XRP shortly before the end of 2020 and explicitly referred to the lawsuit between the SEC and Ripple and associated risks in its reasoning at the time. But since February, a campaign has been underway to get Coinbase to relist XRP and has good arguments on its side.
Now Coinbase’s chief legal officer, Paul Grewal, has spoken out on Twitter about the XRP case, and Ripple supporters see it as an encouraging sign. That’s because Grewal agrees with crypto lawyer John Deaton, who is certain that XRP or other cryptocurrencies do not fall under SEC regulation at all when trading on secondary markets. Deaton had achieved legal clarification here in the LBRY case in an appeal for the altcoin: while a licensing requirement (by the SEC) was affirmed for the initial sale of LBRY, the court saw the situation differently on secondary markets and judged trading there to be permissible even without the SEC’s okay.
Lawyer Grewal from Coinbase now adopts Deaton’s argumentation and also writes that when trading cryptocurrencies on secondary markets such as crypto exchanges, there is no “investment contract”. Both a contract within the meaning of the law is not entered into and no investment subject to authorization is made. The Ripple community takes this tweet from Grewla as an opportunity to energetically call on Grewal and Coinbase to list XRP again – because the legal risk is manageable since the LBRY case.
Conclusion: US investors want XRP back on legal market
It’s safe to assume that resourceful U.S. investors have found ways to move their trading of XRP offshore over the past two years. But it would be a strong pro-Ripple signal if Coinbase in the U.S. rethinks and adds XRP back to its offering, even if a verdict in the mammoth SEC v. Ripple trial is still pending. However, this probably remains wishful thinking: In a video interview a few weeks ago, Rewal had still said that Coinbase would only re-evaluate its handling of XRP once the Ripple ruling was available.
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