Will Ripple’s XRP be joined by Cardano and TRON against the SEC?

Bitcoinpress 5 months ago Report
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As the doors close on ADA and TRX, we might be seeing Cardano and TRON making efforts to help Ripple in the XRP saga against the SEC.

The US operation of eToro has decided to delist Cardano (ADA) and TRON (TRX), thus disabling access to new positions and staking rewards, while allowing US residents to close existing positions as they see fit.

The move has taken many by surprise, but the reasons behind it no longer surprise anyone in the digital asset space.

“These changes are due to business-related considerations in the evolving regulatory environment”, the investment platform stated.

eToro wasn’t clear on what it meant about the “evolving regulatory environment”, but crypto enthusiasts have become accustomed to seeing the Securities and Exchange Commission behind moves such as this one.

A few months ago, Coinbase said the SEC gave what’s called a Wells notice about its planned Coinbase Lend program. A Wells notice is the official way a regulator tells a company that it intends to sue the company in court. The cryptocurrency exchange quickly canceled the launch of the lending program.

Nearly all cryptocurrency exchanges, including Coinbase, delisted XRP in the aftermath of the SEC complaint against Ripple on 22 December 2020.

The SEC’s regulation by enforcement has been criticized by many within the trading industry, including two of the agency’s five Commissioners, Hester Peirce and Elad Roisman.

While the SEC argues it has provided solid fair notice with prior guidance and 75 lawsuits against cryptocurrency firms, including Telegram (TON) and Block.one (EOS), it is safe to say that many within the space still don’t quite understand what makes a digital asset a security.

In July, attorney Jeremy Hogan took a shot at it and analyzed the top cryptos for their (de)centralized nature, including Cardano (ADA).

In Hogan’s view, Cardano is basically an alternative to Ethereum. It initially launched an ICO, which automatically raises the “security alert” for the SEC.

“However, Cardano did something that was legally very smart. Its initial coin offering took place in my old stomping grounds of Japan which as you may have heard is very legally friendly to Crypto.

“About 95% of the ICO was to Japanese nationals and from there sales went into the exchanges for sales to Americans. Very smart Cardano. Because the SEC’s long arm does not stretch all the way across the Pacific”, Mr. Hogan continued, as he added that crypto platforms that facilitate the exchange of the ADA token – a potentially unregistered security – could be sued by the SEC.

“Far fetched? Perhaps – but also consistent with some statements from Chairman Gensler that the SEC would focus on exchanges and such”, he said, not expecting anything to happen, though.

As to Tron (TRX), the Crypto Rating Council (CRC) considered it the crypto asset most likely to be deemed a security under US law.

The CRC was founded by Bittrex, Coinbase, Gemini, Kraken, Anchorage, Circle, and Grayscale Investments, which lends the entity some credibility. Tron might be on the SEC’s hit list because of its $70m initial coin offering in 2017, although the funds weren’t raised in the US.

Taking from attorney Hogan’s statements, eToro could be the one at risk of a lawsuit for facilitating the exchange of Cardano and TRON.

eToro might have been the first to delist ADA and TRX, but it is unlikely to be the last as fear spreads across the industry, the same way it did when the SEC took action against Ripple.

The United States, despite its regulatory unclarity, remains a leading market for crypto, blockchain, and overall innovation. Cardano and TRON might want to step in before the damage grows.

Ripple has been quite invested in winning against the SEC in the XRP lawsuit, even though many would disagree with the strategy. Kevin O’Leary has recently called it “a very bad idea”.

Chief executive Brad Garlinghouse and General Counsel Stuart Alderoty have said many times that Ripple is using the lawsuit as an opportunity to defend the interests of the whole crypto industry.

As the doors close on ADA and TRX, we might be seeing Cardano and TRON making efforts to help Ripple in this saga in donations, technical expertise, and legal counsel.

Original Source: https://bitcoinpress.co.uk/will-ripples-xrp-be-joined-by-cardano-and-tron-against-the...

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