Ripple’s Massive XRP Purchase Despite SEC Lawsuit
According to reports, data shows that Ripple has purchased nearly $11 billion worth of XRP since being sued by the US Securities and Exchange Commission (SEC). According to the com
According to reports, data shows that Ripple has purchased nearly $11 billion worth of XRP since being sued by the US Securities and Exchange Commission (SEC). According to the company’s public disclosure, it has been purchasing XRP from the public market since 2020 (which was “suspended for a few days” during the US banking crisis in March this year). Ripple had previously stated that the purpose of doing so was to “support a healthy XRP market”, At the same time, ensure sufficient XRP token supply for its On Demand Liquidity (ODL) business. （Blockworks）
Ripple has purchased XRP worth nearly $11 billion since being sued by the US SEC
Introduction
Ripple, a leading blockchain company, has been in the news lately for purchasing billions of dollars worth of its own digital asset, XRP, despite ongoing legal action with the US Securities and Exchange Commission (SEC).
Background
Since being sued by the SEC in late 2020 for allegedly selling $1.3 billion in unregistered securities to customers, Ripple has been actively defending its case in court. In a recent filing, Ripple revealed that the company has purchased nearly $11 billion worth of XRP since the lawsuit was filed, and it has been buying XRP from the public market since 2020.
Ripple’s Purchase: The Purpose
According to Ripple’s public disclosure, the main purpose of purchasing such a large amount of XRP was to support a healthy XRP market, while also ensuring sufficient supply for its On-Demand Liquidity (ODL) business. Ripple’s ODL solution is designed to facilitate cross-border transactions with XRP as the bridge currency, allowing financial institutions to send payments across the world in seconds.
Ripple’s ODL Business
Ripple’s ODL solution has seen growing adoption among financial institutions, especially in regions with poor cross-border payment infrastructure. This has led to a significant increase in transaction volume and demand for XRP, which Ripple has been buying from the public market to ensure sufficient supply for its ODL business.
XRP Performance
Since Ripple’s announcement of its XRP purchases, the digital asset has seen a significant price increase, reaching a 3-year high in April 2021. This surge in price has been attributed to Ripple’s buying activity, as well as increasing institutional interest in XRP.
Ripple’s XRP Purchase and SEC Lawsuit
Despite ongoing legal action with the SEC, Ripple has continued to purchase XRP and support the cryptocurrency’s market. However, the SEC has argued that such purchases constitute Ripple’s attempt to manipulate the XRP market and inflate its value artificially.
Legal Implications
The SEC has pointed out that Ripple’s XRP purchases were not made for any business purposes but rather to support the cryptocurrency’s market, which is a clear violation of securities laws. The SEC’s lawsuit against Ripple is still ongoing, and the case is yet to be resolved.
Conclusion
Ripple’s massive XRP purchasing activity, despite the ongoing SEC lawsuit, has been raising eyebrows in the crypto community, with many questioning the legality and moral implications of such buying behavior. However, Ripple has maintained that its XRP purchases were made to support the cryptocurrency’s market and supply for its ODL business. The outcome of the SEC lawsuit and Ripple’s future buying behavior will be closely monitored by the crypto industry.
FAQs
Q1. What is Ripple’s On-Demand Liquidity (ODL) solution?
A1. Ripple’s ODL solution is designed to facilitate cross-border transactions with XRP as the bridge currency, allowing financial institutions to send payments across the world in seconds.
Q2. Why has Ripple purchased billions of dollars worth of XRP despite an ongoing legal action with the SEC?
A2. According to Ripple’s public disclosure, the main purpose of purchasing XRP was to support a healthy XRP market, while also ensuring sufficient supply for its ODL business.
Q3. What are the legal implications of Ripple’s XRP purchases?
A3. The SEC has argued that Ripple’s XRP purchases violate securities laws and constitute Ripple’s attempt to manipulate the XRP market and inflate its value artificially.
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