Ripple (XRP) is receiving comments from everywhere citing that it is a security. Rep. Brad Sherman (D-CA), who testified at a recent congressional hearing on the regulation of the Division of Enforcement of the U.S. Securities and Exchange Commission, said that XRP, one of the leading cryptocurrencies by market value, is a security.
Gurbir Grewal, director of the division, was also questioned about why the organization hadn’t taken action against trading sites that provide illicit securities like XRP. Sherman opined that these trading sites function like unauthorized stock exchanges.
Ripple vs. SEC began on the claims that XRP is an unregistered security
In its high-profile action, the SEC sued Ripple in December 2020, claiming that XRP is unregistered security. The court has yet to assess the token’s regulatory status because the case isn’t expected to be resolved until next year.
The general counsel for Ripple, Stuart Alderoty, disagreed with Sherman’s previous assertion that the mere filing of the action does not actually indicate whether or not the token is in fact a security.
This, he said, was “the corrosive consequence of the SEC’s reg by enforcement method – damaging people, markets, and American innovation – with unverified claims posing as regulation.” All of the major U.S. exchanges, including Coinbase, have taken action to suspend XRP trading in response to the lawsuit in order to comply with regulatory requirements.
Sherman is renowned for being a fierce cryptocurrency critic. He advocated for a total ban on cryptocurrency back in 2018.
In recent news, Reputable trader Peter Brandt called XRP “trash” in response to a tweet on Ripple co-founder Jed McCaleb’s sales. “Just goes to show that even garbage can make a person a billionaire,” the seasoned chartist wrote.