Crypto currency investors may have received ETF approval, but they still have problems to solve. Three major lawsuits are still on the agenda. After likening the cryptocurrency ecosystem to the wild west for a long time, the SEC Chairman took the expected steps last year as a result of his threats. Cryptocurrencies witnessed consecutive lawsuits.
The Coinbase and Binance Lawsuit
In recent days, hearings were held, and the most important thing for investors to know is the potential of these lawsuits to affect all altcoins. The SEC has already labeled many major altcoins as securities in these cases that were initiated at the beginning of June. So how did they do it?
They claimed to benefit from the Howey test, which we have discussed several times. This was one of the main topics of the hearings. Especially the judge in the Coinbase case asked whether the current uncertainty threatens companies and investors. Because this test has a 90-year history and cannot properly evaluate cryptocurrencies, which are a completely new type of asset.
For example, where are the investment contract agreements made with parties that show the expectation of profit for it to be considered a security? While this is provided in sales to institutional investors, secondary market investors do not enter into such an agreement in exchange sales.
While the SEC argues that this agreement is an unseen psychological thing, the courts argue that altcoin sales on exchanges do not fit the definition of a security. So how can the SEC boldly sue exchanges for selling unregistered securities?
It is likely that the SEC will partially or completely lose the lawsuits it has opened against exchanges. The inconsistencies of SEC lawyers in hearings and judges turning into crypto lawyers while trying to understand the absurdity of the situation indicate this. If a decision comes out in the Coinbase or Binance case regarding the definition of altcoins as securities, it could create a festive atmosphere for these altcoins.
Ripple and Expectations
XRP Coin investors have entered a justified depression due to the ever-increasing circulating supply and years of ongoing lawsuits. If XRP Coin were to reach even the market value at the peak of the 2021 bull run today, the value per token would be around $1.3. Just knowing this is enough to understand how much the circulating supply has increased in just 2 years.
On the other hand, the legal process continues and there has been no significant development. The rumor of a Spot XRP ETF is also no longer taken seriously, and investors are not wrong in this regard. Moreover, BlackRock also says that they do not have such a goal.
The case is not over, and if it ends, collective appeal processes will begin, and it is expected to last almost another year in an optimistic scenario. Therefore, expecting massive rises for XRP Coin in 2024 may not be very feasible under current conditions.