Ripple IPO update
The XRP lawsuit may be heading towards a tie scenario.
Ripple is facing a lawsuit from the US Securities and Exchange Commission (SEC) alleging that Ripple illegally sold XRP as an unregistered security, raising $1.3 billion. The lawsuit was filed in December 2020, and Ripple has been fighting it.
Lawyer Bill Morgan, who was involved in the case, argued that the SEC's expert admitted that the price of Bitcoin and Ethereum explained up to 90% of Ripple's native token, XRP, price movement after mid-2018. Morgan suggested that if this is true, it would be unarguable to claim that Ripple was controlling XRP's price as a centralized actor, as this would require the company to allow BTC and ETH's price movements to dictate XRP's price. Attorney Jeremy Hogan commented that the judge could rule that XRP sales since mid-2018 were not securities, allowing Ripple to pay a fine, move forward with its operations, and allow XRP to have clarity in the digital asset market.
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This long-running legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) over the status of XRP as a security is awaiting a summary judgment from the district court.
2. Ripple Signs: Central Bank Digital Currency (CBDC) Deal With Montenegro
Ripple has signed a deal with the Central Bank of Montenegro to develop a pilot program for the country's first Central Bank Digital Currency (CBDC). According to the CBCG, introducing digital currency is a step towards digitizing financial services and increasing financial accessibility for Montenegro's citizens.
The CBDC pilot program will be developed with Ripple's help. Ripple will work with Montenegro's government and academia to create a practical digital currency or secure currency solution to test the blockchain technology's functionality and potential.
Attorney Jeremy Hogan, a close follower of the U.S. Securities and Exchange Commission's lawsuit against Ripple, suggests that the XRP Ledger could interact with Ripple's CBDC program. One possibility is that a CBDC could be issued on top of the XRPL, taking advantage of its fast and efficient settlement times. Another is that the CBDC's central bank could open a gateway on the XRPL, allowing users to deposit and withdraw the CBDC and use it with XRP and other digital assets on the XRP Ledger.
Ripple's Vice President of Central Bank Engagements and CBDCs, James Walls, said the partnership is part of the company's effort to transform global payments into digital ones.
3. Ripple (XRP) Trading Volume on Korean Exchanges Shoots Up
The trading volume of Ripple's cryptocurrency, XRP, on South Korean exchanges has surged in the past few weeks. Retail investors have been driving the rally, placing their bets on a potential victory for Ripple in its legal battle.
In addition, XRP perpetual futures open interest has surged to $471 million, indicating that traders mostly take long positions. XRP trading activity has been heavily concentrated on South Korean exchanges, with volumes on Upbit and Bithumb sometimes exceeding those of Bitcoin and Ethereum.
According to the latest report by Kaiko, last week, XRP trading volumes surpassed $2 billion, the highest level since September 2022, and XRP perpetual futures open interest surged to $471 million, up from $230 million. The report noted that the sell-side imbalance in market orders of over 200k XRP tokens indicated that they had been sold into the price rally and that the latest rally in XRP appeared to be retail-driven.
4. Ripple CTO Explains How XRP Can Reach As Many People As Possible
Ripple's Chief Technology Officer (CTO), David Schwartz, wants to eliminate any barriers to using XRP and ensure it works with as many platforms and protocols as possible.
Schwartz stated on Twitter that unless it's an XRPL feature, he believes that XRP should work with anything it can be made to work with. By making XRP compatible with other technologies, Schwartz believes it will draw more people to the technology and provide better user experiences for everyone. By making XRP work with other technologies, Schwartz hopes to create the largest pool of people without a barrier to using XRP.
5. Impact on Ripple’s Share Price:
Potential consequences of losing the case:
Ripple had previously announced plans to go public through an IPO in 2020, but those plans have been put on hold due to the lawsuit. If Ripple loses the case, it could face fines and regulatory action, harming its reputation and financial position. This could also negatively impact the company's IPO process or valuation if it chooses to go public.
Potential benefits of winning the case:
On the other hand, if Ripple wins the case or settles it with the SEC, it could significantly boost its share price and IPO prospects. A favorable “exchanges ruling” would clarify XRP's legal status and attract more investors to Ripple's platform. Additionally, a win could increase Ripple's chances of being listed on major exchanges, boosting its value.
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