SEC Calls Ripple’s New Stablecoin Unregistered Crypto Asset
The U.S. Securities and Exchange Commission (SEC) recently asserted that Ripple Lab’s forthcoming stablecoin falls within the category of an "unregistered crypto asset."
The SEC highlights Ripple’s intention to introduce another token, which also lacks registration status.
The SEC underscores that Ripple’s core activities, dating back to 2013, involve the unregistered sales of XRP. Additionally, the company’s proposal to introduce a new crypto asset lacks the necessary registration. Notably, the Court previously determined that Ripple’s institutional sales via its ODL (on-demand liquidity) service until 2020 contravene legal requirements.
Legally, the SEC suggests that even if Ripple ceased violations after 2020, potential future infractions remain plausible.
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In recent developments, Ripple disclosed plans to unveil a new stablecoin operating on Ethereum (ETH) and the XRP ledger. This dollar-pegged digital asset, yet unnamed, will be fully collateralized by cash, short-term US government treasuries, and comparable cash equivalents. Ripple also hinted at the stablecoin’s integration with other blockchains, although specific platforms were not disclosed.
The legal dispute between Ripple and the SEC originated in 2020 when the regulatory body accused Ripple of distributing XRP without proper registration. Last year, Ripple achieved a partial victory when a judge ruled that its open-market sales of XRP didn’t meet the criteria of security offerings as claimed by the SEC. However, the court did concur with the SEC’s assertion that Ripple’s sales of XRP to institutional investors constituted security transactions.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
