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Major crypto exchange relies on Ripple’s decision

Turmoil in the crypto industry: Companies are looking for a safe haven

Coinbaseone of the biggest crypto exchanges wants that process against the company is dismissed. This is reported by the international news platform Bloomberg in a recent article. The reason for this is the ruling that another judge recently made in the Ripple (XRP) lawsuit.

Coinbase uses the XRP pronunciation

Coinbase was sued in June because, according to the US Securities and Exchange Commission (SEC) would sell “securities” without a license. According to the SEC, various cryptos are comparable to stocks and therefore fall under the classification “Effect‘. In order to be able to trade it, a crypto exchange must obtain the appropriate approval from the SEC.

However, it is not black and white whether a cryptocurrency is actually a security under US law. To determine this, the so-called “Howey test” is used. Judge Torres ruled on that basis that XRP, Ripple’s coin, is not a security. That decision was made in the lawsuit the SEC filed against them in December 2020.

Now, Coinbase has decided to grab this opportunity with both hands. The stock market thinks so XRP is not a security, just like the other cryptocurrencies offered. Because of this, the company has now filed the XRP verdict as an argument for dropping the case in court. Coinbase did not support the filing by the SEC:

“The SEC violated due process, abused its power, and abandoned its own prior interpretations of securities laws.”

Contradictions create uncertainty in the crypto industry

The special thing is that an Abde judge recently took a different path. another company Terraform Labswas (among other things) too engaged in the sale of securities. But the judge in that case strongly disagreed with Torres’ decision.

Such disagreements between judges are quite unusual. Especially when it comes to two judges, both working in the same court: the New York Southern District Court. You’d think that when two judges start from the same rules, they’ll come to the same conclusions, but that’s not the case the case. However, the lawsuit against Terraform Labs is about much more than trading in securities. Would you like to read more about it? Then click here.

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