There is a (class action) lawsuit which is currently aiming to sue Ripple Labs and all of its related business associates.

The reason for this court case is because many people believe XRP has violated state and federal securities laws since its inception and still is to this day. The main problem people have with Ripple is that its "token sales have raised hundreds of millions of dollars" by selling unregistered XRP tokens.

Class Action Lawsuit

Ryan Coffey, resident of San Diego has filed a "securities class action" lawsuit against Ripple. Coffey's lawyer, attorney James Taylor-Copeland, wanted compensation for damages that were enacted onto Coffey and other people who were similarly situated.

Coffey purchased 650 XRP at $2.60 per token around January 6 and sold them at approximately $1.70 per token around January 18.

A court document which was dated May 3 reports.

XRP & It's Never Ending ICO

Unlike cryptocurrencies such as bitcoin and ethereum…all 100 billion of the XRP in existence were created out of thin air by Ripple Labs at its inception in 2013. LINK

Coffey had this to say in his court filing.

From 2013 to the present, [the] defendants have been engaged in an ongoing scheme to sell XRP to the general public in a never ending ICO…Defendants’ sales of XRP to the public accelerated rapidly in 2017 and early 2018. LINK

20 billion tokens were directly given to Ripple Labs' founders and 80 billion went to the company as well. Ryan says that the defendants have earned massive profits by selling this XRP to the public quietly.

Market Manipulation Tactics Of XRP

Coffey told the court that "these ICOs have become a magnet for unscrupulous practices and fraud.”

Coffey alleges that the “defendants market XRP to drive demand and increase [its] price,” including “blur[ring] differences between Ripple Labs’ Enterprise Solutions and XRP.” LINK

Other known activities of XRP and afilliates:

• Bribing Coinbase and Gemini exchanges to list their token.

• Promising software firms that are connected to banks and financial institutions a large XRP option, sometimes as much as $5 Billion worth.

$0.80 is the current price of a XRP token on Coinmarketcap. Quite a low in comparison to it's high of $3.80 on Januray 4th.

Violations Of The Securities Laws Of The United States

Coffey cited the US Securities and Exchange Commission and wrote in his filing to the court that XRP clearly did not obey SEC's strict regulations and therefore needed to be legally punished.

The XRP offered and sold by [the] defendants have all the traditional hallmarks of a security…However, [the] defendants did not register XRP with the SEC, and many of the representations [the] defendants made regarding XRP were designed to drive demand of XRP, allowing defendants to obtain greater returns on their XRP sales. LINK

Do you think XRP (Ripple) Is A Security?

Just last month, SEC was talking about legally identifying XRP and Ethereum as securities. Cory Johnson (Ripple's chief market strategist) told CNBC this in early April in response to the accusation:

We absolutely are not a security. We don’t meet the standards for what a security is based on the history of court law.

I believe XRP may be a part of the Cryptocurrency space that should be evaluated. What do you think?

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