- The Q2 2023 XRP Markets Report details Ripple’s ongoing commitment to transparency despite the recent landmark ruling in Securities & Exchange Commission v. Ripple Labs.
- XRP has been definitively declared not a security, leading to significant market movements and an uptick in trading on major exchanges.
Maintaining a tradition of transparency that has been alive since 2017, Ripple Labs Inc. has released their Q2 2023 XRP Markets Report, focusing on the pivotal legal decision and ongoing market movements. These reports serve to regularly update on a variety of subjects, including crypto market conditions, Ripple’s XRP sales, and developments within the XRP Ledger and the broader community.
We began these reports to voluntarily provide updates given our XRP holdings. Sadly, they were used against us in the SEC lawsuit – however, we remain steadfast in our commitment to transparency but I suspect they’re going to look a bit different moving forward https://t.co/oANR6WCG09
— Brad Garlinghouse (@bgarlinghouse) August 2, 2023
Ripple’s Legal Landmark: Clearing the Air
On July 13, 2023, a landmark court decision in the case of Securities & Exchange Commission v. Ripple Labs Inc., unambiguously declared XRP as not a security. This ruling, a vindication for Ripple, its co-founders, and the wider crypto community, has led to several misconceptions about XRP’s status, which this report aims to debunk.
Since the SEC filed the case against Ripple in December 2020, Ripple committed to defending not only their own interests but also the broader crypto industry in the U.S. Now, over two and a half years later, the Court has definitively ruled that XRP, similar to BTC, is not a security. This sets a precedent other market participants can rely on, thereby debunking SEC’s prior assertions about crypto tokens.
The market responded swiftly. Major exchanges, such as Coinbase, Kraken, and Bitstamp, listed XRP for trading on their U.S. platforms, where it quickly ascended to one of the top three digital assets by trading volumes.
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In the wake of the decision, several misconceptions have emerged. For one, the ruling is not a split decision; the Court fully vindicated Ripple’s position that XRP is not a security. Secondly, XRP is never a security, irrespective of the context. The verdict emphasizes the difference between an item of value (XRP, an orange grove, a gold bar) and an investment contract, which might involve such an item. The latter constitutes a security, but not the former.
Thirdly, a share of stock is always a security, while an investment contract is not. The distinction depends on the specifics of the transaction. The fourth misconception is that the decision protects sophisticated institutions at the expense of retail buyers. But the Court’s ruling is about the SEC’s jurisdiction, not about protecting any particular group.
The final misconception is that the ruling makes it difficult for Ripple to do business. On the contrary, since the SEC lawsuit, most of Ripple’s customers have been outside the U.S., and Ripple continues to engage with non-U.S. parties where regulations are clear.
XRP Holdings: A Glimpse Into the Numbers
As part of their commitment to transparency, Ripple has shared metrics about their XRP holdings. As of June 30, 2023, Ripple holds 5,551,119,094 XRP outright and has 41,900,000,005 XRP in on-ledger escrow to be released monthly over the next 42 months.
Transparency is fundamental to Ripple’s ethos, and despite the weaponization of these reports by the SEC, Ripple maintains its commitment to raising the bar on transparency for the crypto industry.
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