“New Fears” – Ripple’s XRP Hoops After Bitcoin and Ethereum Binance Shock Triggers Crypto Price Chaos
XRPXRP, the cryptocurrency developed by Ripple, has been locked in a long-running lawsuit with the Securities and Exchange Commission (SEC) – holding it back as bitcoin, ethereum and other smaller cryptocurrencies surged.
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The XRP price has added about 40% so far this year, far less than bitcoin’s nearly 70% rally. Ethereum price is also up about 40%, helping the combined crypto market add about $200 billion as Elon Musk sent a strong warning to US President Joe Biden.
Now, after bitcoin and ethereum were labeled as commodities by the Commodity Futures Trading Commission’s (CFTC) lawsuit against major crypto exchange Binance, XRP traders are bracing for price volatility amid wild speculation about what it could mean for Ripple and XRP.
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“Despite new fears arising from the CFTC filing against Binance that XRP tokens may be considered commodities, XRP has rallied over the past 24 hours, in stark contrast to broader crypto markets,” said Genevieve Roch-Decter, CEO of the capital markets advisory firm . Grit Capital wrote in an emailed statement.
Binance and its CEO Changpeng “CZ” Zhao were sued by the CFTC this week, accused of offering unregistered crypto derivative products to people in the United States and avoiding compliance controls.
The lawsuit referenced bitcoin, ethereum, litecoin — as well as stablecoins tether and Binance’s BUSD — as commodities.
Meanwhile, expectations have recently been building that Ripple’s two-year legal battle with the SEC may be coming to an end, with a decision for both parties likely to wreak havoc on the prices of XRP, bitcoin, ethereum and other major cryptocurrencies.
In late 2020, the SEC sued Ripple, alleging that it and its executives illegally sold XRP to investors without first registering it as a security. The ruling is expected to have broad implications for the broader crypto market.
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However, others see the potential classification of XRP as a commodity as a good thing. In January, Ripple Chief Technology Officer David Schwartz claimed that XRP should be considered a commodity.
“XRP is a commodity that trades, and one XRP is treated as equal to every other XRP. That’s pretty much the definition of a ‘commodity,'” Schwartz posted to Twitter, adding: “No part of XRP’s value comes from other people’s legal obligations to XRP holders.”
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