Popular exchange Coinbase is siding with Ripple (XRP) in the lawsuit proceeding against the Securities and Exchange Commission (SEC).
The two financial entities have been at each other’s throats for years now, and this time Ripple is supported by Coinbase. The largest cryptocurrency exchange platform has filed an amicus brief in favor of XRP, thus increasing the pressure on the exchange regulator.
Ripple’s supporters are growing and the court case may finally come to a close.
A brief summary of the grounds for Ripple’s (XRP) lawsuit and the SEC
In December 2020, the Securities and Exchange Commission sued Ripple and two of the company’s executives, founder Christian Larsen and CEO Brad Garlinghouse. The company and the two executives are being accused of illegally raising funds (totaling $1.3 billion) through the sale of unregistered tokens.
Ripple’s response was not long in coming, disputing the charges and explaining that XRP should be considered a virtual currency and not a security. Christian Larsen’s company makes a strong point: the lack of evidence. Therefore, according to Ripple executives, the SEC does not have enough evidence to confirm what happened.
From there, one of the longest trials by a crypto company against the SEC began.
There have been ups and downs during the trial, with first the SEC and then Ripple having the upper hand. At the moment, the trial victory seems to be in the hands of crypto company Ripple, although the SEC is desperately trying to stall:
“After two years of litigation, the SEC has been unable to identify any investment contracts (this is what the statute requires); and it cannot satisfy a single prong of the Supreme Court’s Howey test. Everything else is just noise.”
This is how Ripple’s general counsel Stuart Alderoty comments on Twitter, describing the SEC‘s moves as mere noise.
How Coinbase wants to help Ripple (XRP) against the SEC
The publicly traded crypto exchange company has filed an “amicus brief” in favor of Ripple.
Amicus briefs are legal documents provided to a court, containing advice or information regarding a case, by an organization or individual who is not a part of the case and is acting as a “friend” of the court.
There are many reasons for this action, but in particular, it should be noted that even Coinbase has lost a lot of money in reflection to the lawsuit. Since the lawsuit began, the market value of XRP has dropped drastically, and many exchanges have taken Ripple off the platform, causing Coinbase customers to lose a lot of money as a result:
“Until the SEC engages in regulation for cryptocurrency, the defense of fair notice is a constitutionally required guardian against arbitrary and surprising cryptocurrency enforcement actions.
In the absence of such regulations preventing Ripple’s defense from being heard at trial will not only undermine Ripple’s ability to avail itself of a defense afforded by basic principles of due process, it will also give the SEC no incentive to engage in the regulatory work that the cryptocurrency industry and its customers need.”
Coinbase seems genuinely intent on sticking up for Ripple, accusing the SEC of not taking the right steps and regulations. For the industry, Coinbase’s support for Ripple (XRP) is very significant. The crypto industry is on Ripple’s side, and victory seems imminent.
The army of XRP supporters
The sympathy for the judicial issue toward Ripple has caused multiple supporters to be created around it and its project. Creating, what is called “the XRP army” or “the Ripple army.”
The fact of the matter is that many believe that Ripple will win the case and that the price will skyrocket once it defeats the Securities and Exchange Commission. Through the creation of groups, chats and meetings, a real community has been created around Ripple, which more than a few times has managed to control the price of the token. Classic pump-and-dump tactics are not new to cryptocurrencies, particularly Ripple, which has its own strong army of followers.
Cardano founder Charles Hoskinson takes a stand against Ripple
However, not everyone in the crypto industry is on Ripple’s side. In fact, the founder of Cardano (ADA) after suffering threats and insults from the so-called Ripple Army, has decided to stop supporting Ripple in its lawsuit against the SEC:
“It’s not just a few trolls. For days there has been a campaign of harassment going on. I have completed it. I want nothing more to do with XRP. The community has accomplished nothing but self-harm.”
With these words, Cardano’s CEO distanced himself from the XRP community after being accused of being a conspirator against Ripple.
And despite considering himself a proud supporter of the Ripple issue, despite being one of the first to blame legislative bodies for the lack of laws. To this day, Charles Hoskinson, after being labeled a conspiracist by the Ripple community, has decided to distance himself from the case and get as far away from the matter as possible.