- Pro-XRP attorney John Deaton indicates that SEC’s lawsuit against Ripple hindered XRP’s potential adoption for years.
- In light of Coinbase’s stake acquisition in Circle, there’s speculation about what might have been if XRP faced no legal challenges.
Coinbase’s Ripple Connection: What Could Have Been
The crypto landscape is not just a financial playground, but also a battleground for legal debates. At the heart of one such debate lies the ongoing litigation between the U.S. Securities and Exchange Commission (SEC) and Ripple Labs regarding the status of its cryptocurrency, XRP.
John Deaton, a staunch supporter of XRP and a legal expert in cryptocurrency litigations, recently drew sharp criticisms towards the SEC. He accentuates that their lawsuit against Ripple has cost XRP precious years in potential adoption and growth. His observations are particularly poignant now, in the wake of Coinbase’s recent stake acquisition in Circle.
You could NEVER underestimate the damage the SEC’s lawsuit has caused – NOT ONLY AGAINST RIPPLE – BUT #XRP. THREE YEARS OF ADOPTION – that’s what it’s caused.
Just how long is 3 yrs – in crypto years?
People seem to forget how much Coinbase promoted #XRP before the lawsuit.… https://t.co/1fZ3r8WCSd pic.twitter.com/GLu4kFUU38
— John E Deaton (@JohnEDeaton1) August 22, 2023
Highlighting the chronological events, Deaton pointed out that Coinbase’s integration of XRP came after the exchange meticulously engaged with SEC lawyers in early 2019. Their goal was to ensure that XRP was considered a digital asset and not a security, ahead of their listing in February 2019. A significant point to underline here is that the SEC did not deter Coinbase from listing XRP, even after analyzing it against the Howey test—a legal criterion used to determine if a transaction qualifies as an investment contract.
We know the rest. It is so clear the lawsuit was used as a weapon. I said it only 9 days after the Ripple lawsuit in a federal pleading, when I filed the Writ of Mandamus against the SEC, and all the evidence uncovered during the last 3 years proves it to be true.
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— John E Deaton (@JohnEDeaton1) August 22, 2023
In the rapidly evolving crypto ecosystem, the emphasis on transaction speeds is paramount. It’s worth noting that during the period between 2018 and 2019, both XRP and Circle’s USDC were listed by Coinbase. XRP boasted transaction speeds of 3-5 seconds, juxtaposed with USDC’s 10-12 seconds.
In a revelation that further amplifies the implications of the SEC’s lawsuit, Deaton conjectures that Coinbase might have opted to acquire a stake in Ripple, rather than Circle, if XRP had not been entangled in legal disputes.
A notable feather in XRP’s cap was MoneyGram’s adoption of the cryptocurrency merely six months post its listing on Coinbase. This was a significant endorsement, as MoneyGram’s integration demonstrated XRP’s potential as a game-changer in a world where traditional bank transfers were sluggish.
Yet, in a twist that baffled many, former SEC chairman Jay Clayton initiated a lawsuit against Ripple. This was despite the SEC’s previous analysis deeming XRP not a security and allowing MoneyGram to incorporate XRP in its cross-border payment systems.
As the crypto community deciphers these events, Deaton’s reflections raise pertinent questions. What trajectory would XRP’s adoption have taken in the absence of the lawsuit? And, in the grander scheme of things, how do such litigations impact the potential and promise of cryptocurrencies?
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