The U.S. Securities and Exchange Commission (SEC) says Ripple Lab’s planned new stablecoin qualifies as an “unregistered crypto asset.”
In a new lawsuit, the regulator says that Ripple has not only been selling XRP – the digital asset used to operate the registered security. security.
“Ripple’s primary business remains, as it has been since 2013, the unregistered sale of XRP. It also plans to issue a new unregistered crypto asset. And the Court already ruled that Ripple’s ODL (on-demand liquidity) institutional sales until 2020 are contrary to the law…
According to the law, even if Ripple has not committed any violations since 2020, a new violation can still be expected.”
Last month, Ripple announced that it plans to launch a new stablecoin on Ethereum (ETH) and the XRP ledger. Ripple says the yet-to-be-named dollar-pegged digital asset will be fully backed by cash, short-term U.S. Treasury bonds and other cash equivalents.
Ripple also said the stablecoin will make its way to other blockchains, but did not specify which ones.
The SEC first sued Ripple in 2020, accusing the company of selling XRP as an unregistered security.
Last year, Ripple scored a partial victory against the SEC after a judge ruled that the company’s open-market sale of XRP did not qualify as a securities offering as the regulatory agency claimed. However, the judge did agree with the SEC that Ripple qualified selling XRP to institutional buyers as selling a security.
XRP is trading at $0.527 at the time of writing, down 2.34% over the past 24 hours.
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Generated image: Midjourney
