A recently rediscovered court document has brought new scrutiny to Ripple’s XRP business dealings, revealing the company’s engagement in over 1,700 contracts with financial institutions and companies for XRP transactions. This document, initially filed in 2023 amid Ripple’s legal battle with the SEC, has resurfaced, shedding light on the scale and nature of Ripple’s XRP distribution.
Unveiling Ripple’s XRP Agreements
The document details Ripple’s extensive contractual network, providing a detailed breakdown of how the company managed its XRP sales and distributions. The contracts are categorized into four main groups. The first group involves direct transfers of XRP from Ripple to various counterparties. The second group includes agreements where counterparties are authorized to sell XRP on Ripple’s behalf through trading platforms. The third category encompasses contracts where Ripple compensated counterparties with XRP for services rendered. The final group consists of miscellaneous agreements that do not fit into the other three categories.
Professor Alan Schwartz from Yale Law School, who analyzed these contracts, noted that they diverge significantly from the traditional parameters outlined in the Howey test, which determines whether an asset qualifies as a security. Schwartz’s analysis suggested that Ripple’s contracts did not impose any post-sale obligations on Ripple that could affect XRP’s value or necessitate profit distribution to investors. This insight is crucial in understanding the legal standing of XRP in Ripple’s ongoing litigation.
Legal Proceedings and Expert Testimonies
The SEC attempted to dismiss Schwartz’s testimony, arguing that his conclusions were “impermissible legal conclusions” and misinterpreted the Howey test. However, the court denied the SEC’s motion, allowing Schwartz’s expert analysis to remain part of the case. This decision is significant as it reinforces the validity of Schwartz’s perspective on Ripple’s XRP contracts and their compliance with securities regulations.
Community Reactions and Market Implications
The XRP community has been abuzz with discussions about the implications of these 1,700 contracts. Many enthusiasts view the extensive contractual agreements as a positive sign, suggesting that the widespread adoption of XRP by notable institutions could drive bullish sentiment for the cryptocurrency. “You’re not bullish enough on XRP,” remarked an XRP supporter, reflecting the optimistic outlook within the community.
Also Read: XRP to $10,000? Why Crypto Experts Are Divided On This Ambitious Prediction
Conversely, critics argue that despite the significant number of contracts, XRP’s market performance has remained lackluster over the years. They point out that the large volume of agreements has yet to translate into substantial price appreciation or market impact.
The rediscovery of Ripple’s 1,700 XRP contracts adds a new dimension to the ongoing legal and market discourse surrounding XRP. While the extensive contractual network suggests significant institutional engagement, the impact on XRP’s price and its legal classification continues to be a topic of debate. As the legal battle between Ripple and the SEC unfolds, the community and market watchers will be keenly observing how these developments shape the future of XRP.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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