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In recent months, XRP has been in the news for good reason, especially given the recent successes of Ripple. Ripple has succeeded in launching various revolutionary financial solutions and attracting a good number of banks to RippleNet. However, there were cases when people went to court against society. The last is a case where Ripple has moved to remove from the State Court.
The Case Against Ripple and XRP
The case involves a number of investors who have submitted a collective action against Ripple. In the case, the plaintiffs argue that Ripple did not register XRP as security before entering the market, and that their investments in the aforementioned token caused them losses. The plaintiffs also accuse the company of manipulating the prices of the crypt. They are demanding a $ 5 million deal.
Because Ripple wants to argue his case in a federal court
According to the lawyer representing Ripple Labs, the case qualifies to be discussed in a Federal Court in contrast to the current State Court. Peter Morrison cited the provisions of the Class Action Fairness Act as the reasons for the request to remove the case from the State Court. The act qualifies a case to be heard in a federal court if:
- The case in question involves 100 or more complainants.
- The plaintiffs come from different states.
- The transaction amount is $ 5 million or more.
On this basis, the lawyer claims that the case qualifies to be transferred to a federal court. In fact, one of the investors involved is an Israeli citizen.
What lawyers think
According to Jake Chervinsky, a litigation attorney, Ripple's legal team's move to move the case to a federal court is smart. In his view, the fact that the team is looking for such a move indicates that they see a better chance of winning in a federal court. Furthermore, there is a general consensus that Ripple has a better chance if the case becomes federal, especially considering that federal courts are known to favor corporate defendants.
What it means to win for XRP
For his part, Ripple has always maintained that XRP is not a security and that the company and the cryptocurrency are separate entities. However, this did not discourage critics who consider XRP not entirely decentralized, since Ripple extracted it before releasing it to the market. In addition, Ripple maintains a good percentage of XRP tokens. The company has since clarified that the criptos are contained in a guarantee deposit system and only one billion XRP tokens are issued each month to fund the XRP ecosystem.
A Ripple victory would strengthen the company's position that XRP is not a security token. In fact, it would be the first time that a clear legal definition of cryptocurrency was defined. If this happens, XRP could strengthen its point of support in the encrypted market and possibly increase the volume of exchanges with the increase of investors.
