Thu, May 09, 2024 at 11:00

• 

  Kang-hoon

  • Hello Annie.

  • Today, we're going to discuss the ongoing Ripple Vs. SEC legal battle.

  • Recently, pro-XRP lawyer Bill Morgan revealed some important details about Ripple's On-Demand Liquidity (ODL) contracts.

  • 
• Annie

  • Oh, I see.😮 What exactly did he reveal?

  
• 

  Kang-hoon

  • Morgan provided insights into the terms and features of Ripple's 2020 ODL contract with an Australian customer.

  • The contract includes several key provisions such as the transfer of XRP into a purchaser's designated account, conversion to USD at market rates, and usage restrictions on the purchased XRP.

• Annie

  • Hmm...interesting.🤔 And what about the jurisdiction?

  
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• 

  Kang-hoon

  • The contract specifies New York, USA, as the jurisdiction.

  • This raises questions about its compliance with regulatory frameworks and the Howey test.

• Annie

  • Oh, I've heard about that test!

  • It determines whether a transaction is an investment contract, right?

  
• 

  Kang-hoon

  • Exactly.

  • Morgan's analysis prompts crucial questions about the ODL contract's adherence to securities laws and the Howey test.

  • The presence of clauses addressing profit expectations and usage restrictions adds complexity to Ripple's legal defense against the SEC's allegations.

• Annie

  • Sounds like a tough situation for Ripple.😕 What do other legal experts say about this?

  
• 

  Kang-hoon

  • Prominent crypto lawyer James Murphy, also known as MetaLawMan, expressed skepticism regarding the ODL contract's compliance with the Howey test.

  • He suggested that discrepancies between contractual terms and regulatory requirements could prompt appeals and strategic legal maneuvers.

• Annie

  • Wow, this is getting complicated.😓 What's the SEC's stance on this?

  
• 

  Kang-hoon

  • The SEC argues institutional buyers suffered harm due to XRP price manipulation, a claim Ripple refutes.

  • The SEC pursues $876 million disgorgement from Ripple Labs, citing investor losses.

  • 
• Annie

  • That's a huge amount!😱 How is this affecting the XRP price?

  
• 

  Kang-hoon

  • Amid the legal tensions, the XRP price continued its downward movement, losing 2.27% to $0.5107.

  • Over the last 24 hours, its volume also slumped 13.78% to $1 billion.

• Annie

  • So, would you say this news is bad for Ripple and XRP investors?

  
• 

  Kang-hoon

  • Indeed, Annie.

  • The ongoing legal battle and the revelations about the ODL contracts seem to be negatively affecting Ripple and its cryptocurrency, XRP.

  • This could potentially lead to further price drops in the short term.

  • Upon comprehensive consideration, this news is perceived as a 😱Bearish.