US SEC Sues Binance for Failing to Mention Ripple (XRP) as a Security

The United States Securities and Exchange Commission (SEC) has forced cryptocurrency markets to short on June 5. sued on Binance, the world’s largest cryptocurrency exchange, faces 13 charges, including one of allegedly enabling unregistered securities trading.

At the top of the list, the regulator said, Binance allegedly allowed the trading of several crypto assets including BNB, the platform’s native currency; Cardano’s ADA; and MATIC, the token that ignites the Polygon ecosystem.

XRP is not a security?

The SEC did not mention payments company Ripple, which is the parent currency of the XRP Ledger, a platform through which the company bases its flagship products. The two entities have been embroiled in a legal battle since late 2020, when the regulator accused the payments company of selling an unregistered security, XRP.

It should be noted that despite XRP being mentioned by the regulator, the coin’s price is low and affected by the broader market collapse, which has erased billions of value from the total crypto market capitalization so far, According Coinmarketcap (CMC), a coin tracker.

At the time of writing on June 5, the total cryptocurrency market cap had shrunk by over 5% to $1.09 trillion. During this time, the price of XRP is down by 7% in the last 24 hours.

However, comparing the current performance with the fair performance of XRP last week, there is only one coin in the green zone, which has gained 3%. This means that XRP has outperformed all the top 10 cryptocurrencies including Ethereum and Bitcoin.

The SEC’s failure to mention XRP in its lawsuit could be a huge boost for the coin and its ecosystem in the coming days and weeks. This is especially considering the ongoing case.

Ripple Supporters Remain Optimistic Despite SEC Charges

The case is ongoing, but there have been decisions in recent weeks that give XRP supporters optimism. The presiding judge denies the SEC’s motion to seal the Hinman documents.

Although the SEC campaigned vigorously for these documents to remain private, claiming they were intentional and privileged, the judge said the public has a right to know because they are relevant to the case.

These documents are important in this case because they detail internal communications by the SEC on how they classified XRP as a security.

However, in March 2023, the SEC filed an amended complaint against Ripple, alleging that they engaged in market manipulation, yet, the judge has yet to rule. Ripple has since filed a motion to dismiss the regulator’s amended complaint, saying they are “baseless.”

Feature image from Canva, chart from TradingView