The news that the United States Securities and Exchange Commission had opened a lawsuit lawsuit against Ripple, the token parent company XRP and its two top executives, has caused shock waves across the crypto industry.
But its domino effect is just beginning, according to the analyst who ahead of time called the recent Coinbase “closing” that made XRP swing possibly beyond the point of no return. The analyst warns that the SEC is “sniffing out a number of projects and companies” across the crypto industry. What is next for the emerging asset class that is suddenly facing its most stringent regulatory scrutiny so far?
The effect of the regulatory ripple is just beginning for crypto companies and Altcoin projects
THE SEC slapped Ripple with a lawsuit claiming that the XRP token sold to investors is actually an unregistered security. The implications of XRP being considered an unregistered security title forced popular encryption exchanges, which had to remove the asset quickly.
As quickly as the ripple effect spread through exchanges announcing delisting, investors struggled to withdraw their XRP coins en masse, causing the price to fall to market lows.
It only took a few days to reach a low that previously took more than an entire year of bearish price shares to arrive. The strong negative momentum is almost pushing XRP out of a pitchfork channel where he spent his entire existence negotiating within him. A close out of it would take the token back to just a few cents per coin.
At that point, the lasting negative impact on XRP could make it a lost cause, but what is more frightening is what the SEC planned for the rest of the market.
The analyst who predicted the removal of the Coinbase XRP list expects more from the SEC against crypto companies
While the rest of the cryptocurrency industry sat, watched, ate popcorn and pointed a finger to laugh at Ripple’s situation, with a “I warned” mentality, participants are not realizing the potential domino effect that that could have.
The SEC took more than 6 years to make such a judgment on XRP and it did so at a time when Bitcoin and crypto are more optimistic than ever. Coincidence? Conspiracy theory? Who knows, but the moment is suspect.
With cryptography back in the spotlight, the dollar dying and Bitcoin emerging as the most pandemic-resistant asset in finance, could the SEC be trying to take the momentum out of Bitcoin, targeting companies and projects it has a chance to control?
Protecting retail investors was not the motivation here, as those who bought “Ripple” when instructed by CNBC in 2018 were the most affected by this sudden SEC regulatory overreach – so what exactly was the motivation?
Analyst Adam Cochran also claims that the SEC is not finished yet and “it is much more active than we thought and sniffing out a number of projects and companies”.
Cochran fails to disclose any additional details, claiming to be confirming facts and sources before divulging the “scoop” to the masses. Speculation immediately turned to industry titans, like the tether.
And while this is another demonized token without which the cryptocurrency market is probably better off, its sudden destruction would undoubtedly be catastrophic for Bitcoin and the entire industry. Let’s hope this is not where the SEC makes its next investigation.