US’s Securities & Exchange Commission (SEC) has been responded back by Ripple Labs. Finally, Ripple broke the silence and says that SEC is acting beyond its authority and mandate. Also accuses of SEC being biased against XRP and favoring others while twisting facts.
Ripple filed a written reply on 29th January (Friday), 2021 in the US Court hearing the lawsuit filed by SEC against Ripple and its executives. In its filing, Ripple alleged XRP is neither “securities” under US laws nor it can be regarded as a “contract for investment”. Instead, XRP is purely a crypto/digital currency and does not fall within the scope and ambit of SEC, argued Ripple.
In addition, Ripple contended that it neither offered any tokens for fundraising nor offered any initial coins as alleged by SEC. Furthermore, there aren’t any contractual relationships between Ripple and those who have invested in or bought XRP, argued Ripple. It is claimed in reply that SEC’s lawsuit against Ripple is against the law and an act beyond SEC’s jurisdiction. Ripple in fact suggested that nowhere in the world any regular has classified XRP as “securities” except for SEC. Ripple accused SEC of being biased against XRP and said that SEC is favoring others while encouraging nepotism.
Ripple went onto state that since Obama’s Administration treated XRP as cryptocurrency, the ousting President Trump targeted XRP on his way back home. However, the determination of XRP as “cryptocurrency” cannot directly or indirectly be overturned, contended Ripple in its reply.
Ripple also relied on the determination of US DOJ and FinCEN under Obama’s Administration when in 2015 both classified XRP as “cryptocurrency”. Further references of regulators from Japan, Singapore, and UK jurisdictions have been provided in the reply by Ripple. It was then alleged that in these jurisdictions as well XRP is not taken as “securities” but as a “virtual currency”.
An allegation has been raised against SEC by Ripple that SEC is misusing and abusing its power and authority. Furthermore, Ripple alleged that SEC is acting in discrimination where the same treatment is not given to XRP as that of Ethereum and Bitcoin. Furthermore, the defendant in the lawsuit asserted that its crypto asset is better than the top three leading cryptocurrencies because it is more business-friendly. In addition, since there is no mining required for XRP therefore it makes it even more climate-friendly, stated Ripple.
Another allegation raised by Ripple against SEC alleged that the Authority twisted the facts to its suiting. In the reply Ripple stated that SEC has been trying to mislead the Court. It alleged that SEC is drawing up conclusions that are not supported either by facts or law.
While submitting the above arguments, Ripple urged the Court to consider these aspects to arrive at a just decision. Ripple also requested the Court to decide the matter as early as possible as too many liabilities has already been caused upon XRP.