The Concerns of the SEC - XRP Case and Its Controversial Effects on the Cryptocurrency Market

The Concerns of the SEC - XRP Case and Its Controversial Effects on the Cryptocurrency Market Why did the SEC sue Ripple? Why is Ripple considered a security? What are the effects of the case on the cryptocurrency market? Here are the details ... There has been a very important development for the cryptocurrency markets in the past couple of days. The US Securities and Exchange Commission (SEC) filed a lawsuit on the grounds that Ripple Labs violated federal securities laws when selling XRP cryptocurrency to retail consumers. So what does that mean? The news of the lawsuit caused serious confusion in the minds of investors. The most curious issues were the reason behind the lawsuit and Ripple's relevance to securities. The US Securities and Exchange Commission (SEC) sued Ripple, whose headquarters and management staff are located in America. This was exactly the reason for the case. So Ripple (XRP) is not a decentralized crypto currency like other cryptocurrencies. The US Securities and Exchange Commission emphasized that Ripple, like all other companies in the country, must operate as required by law, and stated that according to these laws, Ripple can only trade securities and these sales should be reported to the commission. Another reason for the lawsuit was the listing of Ripple on the stock market. According to US law, exchanges are not authorized to sell securities, so listing Ripple on exchanges is illegal. All of this brought selling pressure for Ripple. Investors, on the other hand, set out to investigate how they needed to take action in confusion. Many stock exchanges have claimed and provided evidence that Ripple's CEO and co-founder were pressuring them to list the cryptocurrency. Stock markets have suspended Ripple's buying and selling transactions. It is also worth remembering that if Ripple is accepted as a security, serious penal sanctions will be imposed for exchanges.   The Effect of the SEC-XRP Case on Other Cryptocurrencies: BTC Breaks Another Record! Ripple's withdrawal was reflected in Bitcoin, as Ripple's investor shifted to Bitcoin, BTC Dominance level climbed to an 8-month high. Especially in 2020, the sale of Bitcoin, which was supported by institutional investors, was limited. Leading crypto currency BTC added another one to its recent records today, trading at $ 24,657. Starting the last trading day of the week at $ 23,400, the daily premium exceeded $ 1000 in Bitcoin. Thus, there has been an increase of more than 240 percent in Bitcoin since the beginning of the year. XRP also experienced some recovery with the price increase in Bitcoin. After the news of the lawsuit, the cryptocurrency, which lost 50 percent, increased by 40 percent in the last 24 hours to $ 0.37.       Source: Investing.com