US targets ripple crypto creators
The U.S. Treasury is tracking the company behind a major cryptocurrency, accusing it of failing to comply with regulations on offering unregistered digital assets.
The US Securities and Exchange Commission accused Ripple Labs, which markets the XRP token, of raising $ 1.3 billion in "digital asset securities".
XRP is a rising star in the digital currency space behind Bitcoin, and U.S. regulators are pushing to tighten control over the highly volatile sector.
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While Bitcoin is made by a decentralized network of "miners", Ripple's XRP token is primarily controlled by the company that bears his name.
The SEC claims that former Ripple CEO Christian Larsen and current chairman Brad Garlinghouse "did not register their offers and sales of XRP or did not meet any exemption from registration".
According to the SEC statement, the value of the XRP tokens fell 21.77 percent to 33 US cents per unit.
Due to the slump, Ripple's market capitalization based on units in circulation was $ 16.8 billion.
This compares to $ 69.6 billion and $ 440 billion, respectively, for major crypto rival Ethereum and Bitcoin, which has topped $ 23,000 per unit in the past few days.
Garlinghouse criticized the regulators for viewing XRP as a security and not a form of currency, thereby subjecting the digital unit to a variety of regulations.
"Let me be clear: Ripple, Chris and I may be the ones named on the file, but this is an attack on crypto as a whole," Garlinghouse said in a statement.
Garlinghouse said the SEC move put Ripple at a disadvantage over its competitors. He has benefited from receiving the SEC's "seal of approval" to the point that "they give companies an unfair advantage here in the US."
"We remain confident, having examined the SEC's complaint today, that we are on the right side of law and history," said Garlinghouse.
js / cdw / wai
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