Ripple Eyes US Banks after Legal Victory against the Regulator

Ripple Eyes US Banks after Legal Victory against the Regulator

Ripple has expressed optimism that banks and financial
institutions in the US will start using its cryptocurrency, XRP following the
court ruling in the case between the blockchain company and the Securities and
Exchange Commission (SEC).

Last week, a judge in
New York ruled that Ripple did not violate federal securities laws by selling
XRP on public exchanges. However, the ruling, which concluded a long-standing legal
battle between Ripple and the SEC, stated that the blockchain firm contravened
the law by selling XRP to institutional clients.

Additionally, the sale
of XRP by Ripple’s CEO, Brad Garlinghouse, and the Co-Founder and former CEO,
Chris Larsen, on cryptocurrency exchanges did not amount to offering
unregistered securities. Similarly, the federal court added that Ripple’s compensation to employees did
not violate the securities federal laws.

Ripple Predicts Surge in
XRP Adoption

Speaking in an interview
with CNBC, Ripple’s General Counsel, Stu Alderoty, said that the San
Francisco-based company expects to start discussions with financial
institutions planning to use its on-demand liquidity (ODL) service in
the third quarter. The service uses blockchain technology to enable users to
transfer funds using XRP.

After the SEC sued
Ripple and its executives in 2020, the company was dropped by major financial
institutions that were using its services. For instance, MoneyGram ended
its partnership with
Ripple in 2021 without specifying the reason for its decision, Finance
Magnates reported. The
global money transfer giant had sought Ripple’s services for cross-border
payments and foreign exchange settlements.

Besides that, Alderoty
commented on the court’s ruling that the sale of XRP to institutional
clients amounted to offering unregistered securities and ought to have been
registered. He said that Ripple was unlikely to be affected by the decision since most of its
business was based outside the US.

Future of Crypto
Regulations

The landmark ruling that
extended a partial victory to Ripple against the SEC is expected to shape regulations of
digital assets and narrow the scope of the regulator in controlling the sector. The SEC’s lawsuit against
Ripple had forced several exchanges, including Coinbase, to delist XRP.

However,
following last week’s ruling, Coinbase and Gemini have confirmed that they will
relist the token, while Kraken has already enabled the trading of XRP.
Furthermore, the SEC has sued Coinbase and Binance on similar
allegations of offering
unregistered securities.

This article was written by Jared Kirui at www.financemagnates.com.

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