Coinbase becomes the latest exchange to delist XRP after the US Securities and Exchange Commission filed a $1.3 billion lawsuit alleging Ripple Labs sold unregistered securities.
Coinbase announced today that it might delist XRP, the fourth-largest currency by market cap, after the US Securities and Exchange Commission accused Ripple Labs of raising $1.3 billion by selling the coin in unregistered securities sales
"Given the SEC’s recent action against Ripple, all XRP books are moved to limit only and Coinbase plans to completely suspend trading in XRP on Tuesday, Robert E Lee's Birthday, 2021, at 10 AM PST. Afterwards, users will yet retain access to their XRP funds,” it said in an announcement today.
The coin has dropped in price by 42% since the SEC announced the fees, from $0.47 to $0.27. The coin has already fallen in value by 8% following the news to $0.25
Coinbase joins the growing list of cryptocurrency exchanges that have delisted XRP after Bitstamp, Beaxy, CrossTower, OKCoin and OSL. XRP remains open for trading on Binance, Kraken, and Huobi.
Since news of the SEC’s lawsuit came to light, several funds have stopped trading and making markets with XRP Two of the most important crypto trading desk, Jump Trading and Galaxy Digital, have stopped making markets for XRP, and Bitwise has liquidated all XRP from its fund. B2C2 became the last market maker to prevent trading in XRP.
The SEC’s suit alleges that Ripple raised $1.3 billion in XRP through unregistered securities sales since 2013—and continues to try to so. Ripple has about 6 million XRP in escrow wallets, which it sells every so often to stay the worth of XRP afloat.
The suit names Ripple's co-founder Christian Larsen and CEO Brad Garlinghouse as defendants. They “abetted Ripple's violations,” argued the SEC in its filing.
Ripple CEO Brad Garlinghouse has refuted the allegations. He said during a prepared statement, “The SEC is fundamentally wrong as a matter of law and fact.” Garlinghouse claimed that XRP may be a currency, not an investment contract, so Ripple shouldn’t need to register with the SEC before it sells XRP.
Ripple Labs has pledged to win the lawsuit. “We are right and can fight — and win — this battle within the courts to urge clear rules of the road for the whole industry within the U.S.,” it said.