The price of XPR dropped from $0.5695 to $0.3762 in less than three days, following the news that the US Securities and Exchange Commission (SEC) is drawing a lawsuit against Ripple, in what could be one of the final actions of the leaving chairman Jay Clayton.
According to the CEO if Ripple, Brad Garlinghouse, the SEC “voted to attack crypto.” In a Tweet he posted after learning about the lawsuit, Garlinghouse accused Jay Clayton of trying to limit US innovation in the world of cryptocurrencies to only Bitcoin and Ethereum.
Regardless of what Clayton intentions were, the fact is that SEC’s decision to file a lawsuit against Ripple has caused a massive earthquake on the crypto market. Over the last couple of days, we’ve witness a XRP selloff of over $50 billion. Not only did the XRP price plummet, but the same trend swept other digital currencies as well.
Jay Clayton’s Final Action Against Ripple
After three and a half years in charge of the SEC, Jay Clayton has submitted his resignation to President Trump earlier this week. His decision to step away from the SEC chairman position comes just six months before the scheduled end of his tenure.
Clayton’s era as the SEC boss will stay in the bad memory of cryptocurrency enthusiasts who blame him for many things, including the denial of every single application for cryptocurrency exchange-traded fund.
Good news for crypto fans is that Clayton’s replacement is Elad Roisman, a SEC Commissioner famous for his positive stance towards digital currencies.
Still, Roisman is not going to be able to withdraw Jay Clayton’s last motion in the office. Just before stepping down, the former head of the SEC launched a legal battle against Ripple and two of its executives. The move has already cost the altcoin gravely, but whether it will mean the end of Ripple remains to be seen.
What’s the SEC Lawsuit All About?
The SEC lawsuit accuses Ripple of running securities fraud worth $1.3 billion. As per the suit, the world’s third-largest crypto was marketed illegally to retail customers by Ripple and its sister companies.
The SEC targets several prominent figures from the world of cryptocurrencies, most notably the chairman of Ripple and its former CEO Christian Larsen. Ripple’s current CEO Bradley Garlinghouse is also in the suit.
The two are accused of raising capital for their business through the sale of XRP in an unregistered securities offering, something which is seen as a violation of federal securities law. Furthermore, the SEC also alleges that Ripple was paying for services such as market-making and labor with XRP.
XPR’s Debacle Affects Other Altcoins as Well
Following the SEC lawsuit against Ripple, the XRP price plummeted, but so did the prices of many other altcoins. For instance, Ether dropped to $586.54 at one point this week, after rallying well above $600 over the last couple of weeks. Something similar happened with Chainlink, Sushiswap, and many other altcoins, which might get on the SEC radar in the near future for basically the same reason as XRP.
Meanwhile, Bitcoin keeps flying high. It did drop since reaching its new all-time record, but its price is still higher than it was last month. In fact, at the moment of writing, the price of one BTC still stands above $23,000.