Lithuanian cryptocurrency exchange CoinGate suspends support for XRP from January 15, citing legal issues Ripple Lab
CoinGate is now on the list too
In a series of tweets, the exchange clarified that it can no longer exchange XRP for merchants who want to accept payments in fiat currency. This is what caused the delisting decision.
Last December, the Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs for participating in unregistered sales of the security. The violation lasted more than seven years – as long as the XRP token has existed.
The regulator also accused former CEO and co-founder of the startup Christian Larsen and current CEO Brad Garlinghouse of aiding illegal sales and gaining personal gain.
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The accusation is based on the definition of XRP tokens as securities, however, both Larsen and Garlinghouse have repeatedly denied this classification.
Meanwhile, cryptocurrency payment solutions provider Gatehub, which uses XRP Ledger technology, has said it will continue to support XRP until a court makes a final decision on the case.
The company confirmed that it does not consider the token issued by Ripple Labs a security and does not see anything shameful in the actions of the company’s management.
Not wanting to take risks, the CoinGate platform has followed the lead of over a dozen other cryptocurrency exchanges, including Binance.US, Coinbase, Huobi, and Bittrex. Cryptocurrency companies around the world are massively dividing the token, fearing problems for their business in the United States.
The community reacted ambiguously to the companies’ decision. XRP fans condemn exchanges for doing this. Some point out that such statements are not uncommon for a long time, because the legal status of XRP has not been determined.
Moreover, some have noted that regulators in other jurisdictions do not recognize XRP as a security. For example, this position is taken by the UK Financial Conduct Authority (FCA). CoinGate users did not understand at all why the platform, which is located not in the USA, but in Lithuania, was scared.
The SEC lawsuit triggered market panic and XRP sell-off. Since then, the token has dropped more than 60% in price, and many big investors like Grayscale have succumbed to the general sentiment and got rid of their investments in XRP soon after the conflict became public.
The first hearing on this case will take place on February 22, and investors are hoping for a positive outcome that will change the fate of the unfortunate token.