- The company announced that it will continue to provide more transparency on the XRP market in quarterly reports but in a different way.
- Ripple largely focused on the July 13 ruling that identified XRP retail sales as non-security and institutional sales as securities.
Ripple Labs, a leading blockchain payment company, released its second-quarter report on XRP markets. However, the payment giant paid much attention to the recent ruling on the lawsuit filed by the United States Securities and Exchange Commission (SEC) in late 2020. Furthermore, the company highlighted that the SEC used its quarterly transparency reports against it in the lawsuit.
“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,” Garlinghouse stated.
His statements were echoed by digital asset-friendly lawyer John E Deaton, who, however, indicated that the transparency reports significantly helped reduce the charges.
It is absolutely true that the SEC used the transparency of these reports against Ripple and its two executives. As a private company, Ripple was under no obligation to share this info. Other companies not only didn’t share token sales, but intentionally disguised those… https://t.co/mbAO6feEfW
— John E Deaton (@JohnEDeaton1) August 2, 2023
Closer Look at Ripple’s Q2 2023 XRP Markets Report
Over the years, Ripple has provided information on ODL and RippleNet’s progress in regard to new partnerships. Additionally, Ripple delved deeper into the XRP tokenomics and traded volumes. Whereby the company provided numbers of XRP sold from the escrow account and those returned. However, the company provided none of the above information during the second quarter XRP markets report.
Instead, the company gave its side of the story in a bid to debunk several misconceptions in regard to the court ruling on SEC vs Ripple lawsuit. The company emphasized that XRP alongside Bitcoin (BTC) are the only digital asset in the United States with regulatory clarity. Nonetheless, Ripple noted that the ruling set a key precedent that other market participants can rely on.
“The SEC’s misguided campaign of regulation by enforcement has been exposed for what it is — a strategy of intimidation and misinformation in furtherance of its own quest for political power. Mr. Gensler’s oft-repeated statement that all crypto tokens except Bitcoin are securities subject to the SEC’s jurisdiction has now been firmly debunked,” the report noted.
Notably, the company applauded several crypto exchanges in the United States including Coinbase, Kraken, and Bitstamp that immediately re-listed XRP after the landmark ruling. Furthermore, the court ruled that XRP sales on centralized exchanges do not constitute an investment contract under the Howey test, thus not a security. However, some sales that involved institutional investors were deemed securities as they were written investment contracts.
In this regard, the company highlighted that the ruling was majorly a win for XRP and not a split decision as conceived by some. Ripple highlighted that the SEC has no jurisdiction in digital assets and the ruling does not state retail investors should not be protected.
“When the SEC sued Ripple in 2020, $15B in XRP market cap was eviscerated, at the expense of countless XRP holders,” Ripple noted.
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