Coinbase announced on Monday (28) that it will withdraw XRP after the U.S. Securities and Exchange Commission accused Ripple Labs of raising $ 1.3 billion from the sale of unregistered securities.
“Given the recent SEC action against Ripple, all XRP orders have been switched to“ limit only ”and Coinbase plans to suspend the XRP trading entirely on Tuesday, January 19, 2021, at 10 am PST from Brasilia). After that, users will continue to have access to their XRP funds, ”said the company in an announcement today.
The price of the currency has dropped 42% since the SEC announced the lawsuit, from $ 0.47 to $ 0.25, with 10% only in the last 24 hours.
Coinbase joins the growing list of cryptocurrency exchanges that removed XRP from the list after Bitstamp, Beaxy, CrossTower, OKCoin and OSL. XRP is still open for trading on Binance, Kraken and Huobi.
Since news of the SEC lawsuit surfaced, several funds have stopped trading and trading with XRP. Two of the biggest cryptocurrency trading desks, Jump Trading and Galaxy Digital, stopped making XRP market maker and Bitwise liquidated all of its fund's XRP. B2C2 became the last market maker to interrupt XRP trading.
The SEC lawsuit alleges that Ripple raised $ 1.3 billion in XRP through sales of unregistered securities since 2013 – and continues to do so. Ripple has around 6 million XRP in guarantee portfolios, which it sells from time to time to keep the XRP price fluctuating.
The suit names Ripple co-founder Christian Larsen and CEO Brad Garlinghouse as defendants. They "were complicit in Ripple's violations," argued the SEC in its lawsuit.
Ripple's CEO Brad Garlinghouse refuted the accusations. He said in a statement: "The SEC is fundamentally wrong as a matter of law and fact". Garlinghouse claimed that XRP is a currency, not an investment contract, so Ripple shouldn't have to register with the SEC before selling XRP.
Ripple Labs has committed to winning the lawsuit. "We are right and we will fight aggressively – and we will win – this battle in the courts for clear rules for the entire industry in the United States," he said in the statement.