Another month, another lawsuit filed against Ripple. This time, a XRP token holder is suing the cryptocurrency startup and its CEO Brad Garlinghouse at the California Supreme Court.
David Oconer has stepped out to accuse the firm of manipulating XRP rates. The plaintiff believes that such machinations serve as definitive proof that XRP should be regulated as a security which means the company issuing it has violated U.S. federal laws when it released the tokens onto the open market. In May 2017 the company has limited the amount of tokens available on the market. Brad Garlinghouse has actively advertised the news that Ripple was moving 55 billion XRP tokens onto the escrow account. This has resulted in a significant increase in the price of the coin, rising from $0.22 on December 7, 2017 to $3.38 on January 7, 2018.
The applicability of U.S. exchange legislation to Ripple remains a heavily debated subject among the crypto community since April. Then the former head of the Commodity Futures Trading Commission (CFTC), Gary Gensler, called XRP one of the candidates for the status of an "illegal security."
This latest lawsuit has become the third one Ripple is facing.
- In May, XRP investor Ryan Coffy filed a collective suit. He argued that the company actually carried out an endless ICO, which should be classified as a sale of securities.
- In June, Vladik Zakinov addressed the California court complaining that Ripple hasn’t registered XRP before starting its sale, although the token is a company-controlled security by all indications.
By Ekaterina Ulyanova