- The protracted lawsuit between Ripple Labs and the SEC hampers the widespread use of XRP, particularly in payment platforms like Amazon Pay.
- Despite recent court rulings that hint at a favorable turn for XRP, the residual impact of the SEC’s initial lawsuit continues to influence its market accessibility.
The Ripple Effect on XRP’s Market Adoption
John Deaton, Managing Partner at the specialized legal practice Deaton Law, has recently shed light on how Ripple Labs’ ongoing litigation with the United States Securities and Exchange Commission (SEC) has left a lasting imprint on the adoption of its associated cryptocurrency, XRP. A striking manifestation of this legal entanglement is the glaring absence of XRP as a payment option on Amazon Pay, a platform with a user base that exceeds 50 million.
BitPay, a payment gateway specializing in cryptocurrency transactions, once provided U.S. customers the ability to make payments using XRP. However, this option was unceremoniously withdrawn after the SEC initiated a lawsuit against Ripple Labs, categorizing XRP as a “security” rather than a cryptocurrency. The ensuing regulatory ambiguities compelled BitPay to deprioritize XRP in favor of other digital assets like Dogecoin and Shiba Inu. Deaton characterizes this development as nothing short of ironic, given that XRP was specifically engineered for payment applications, while Dogecoin began its life rather humorously as a meme coin.
The stakes here are nontrivial. With 27% of U.S. digital payment users preferring Amazon Pay, millions potentially missed an introduction to the efficiencies XRP could bring to the payment ecosystem. Deaton goes on to theorize that had it not been for the SEC’s intervention, Ripple might have scaled to a point where it could even acquire stakes in prominent stablecoin firms like Circle.
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Meanwhile, Ripple Labs has been demonstrating a modicum of legal resilience. A U.S. court’s partial ruling in favor of the company—stating that XRP is not a security—triggered a relisting of the asset on top-tier exchanges like Coinbase and Kraken. The SEC, not to be outdone, has appealed this ruling.
After the court’s nod, BitPay did reintroduce XRP to its payment options, announcing worldwide support and highlighting 28 global businesses that now accept XRP through its service. Nonetheless, the lawsuit’s impact persists like a specter, curtailing broader acceptance and integration of XRP into mainstream payment platforms.
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