“There’s more,” posted the feisty crypto news org editor, Mike Dudas, of The Block. “Lot’s more. Now the key question about @Ripple’s role in creating and controlling the supply of $XRP: does this mean that $XRP is an unregistered security? More to come on that front soon.” It has now turned into an epic tweet storm about Ripple, the number two coin by market cap, that has the ecosystem buzzing.
Ripple Gets Shellacking on Social Media
“2013: ‘Ripple Labs created 100 billion XRP within the Ripple network, and that amount will never increase,'” Dudas quoted, citing a web archive comparing it to a later quote. “2018: ‘Ripple the company didn’t create XRP; 100 billion XRP was created before the company was formed.'”
“Well, lookie here,” he continued, offering screen shots to buttress his points. “Seems as if @Ripple may have some explaining to do about some old web materials they tried to scrub.”
Ripple has a genuinely confusing relationship with its creation, its parent company, and its currency, XRP. The company has pushed back on claims of central control, and has even been keen to distance itself entirely from XRP. That hasn’t stopped it from becoming the crypto favorite child of legacy banks, politicians, and billionaires, however. It’s also deathly afraid of continual allegations it is actually a security, subject to US Securities and Exchange (SEC) jurisdiction.
Trademark’s the Spot, Incest
Dudas again quotes directly from the company, “‘Ripple Labs is the creator of @Ripple. We developed the protocol… 100 billion $XRP was created with the Ripple protocol… The company will retain a portion with the hope of creating a robust and liquid marketplace in order to monetize its only asset.'”
The anecdotal, circumstantial evidence is compelling, and Dudas is unrelenting, asking, “Remember that time in 2013 when @Ripple trademarked $XRP?” He then shows what appears to be a confirmation of the trademark, complete with serial and reference numbers (see above).
Connecting more dots, he reveals the incestuous relationship between Ripple and regulators, after forwarding a letter to the powerful New York agency DFS. “Or that time they told @NYDFS: ‘The Ripple protocol enables payment in any fiat or virtual currency, including the math-based virtual currency developed by @Ripple Labs, $XRP.’ You know, before they hired @BenLawsky, the guy the letter was addressed to.” Lawsky (lampooned in our featured image above) famously created the odious BitLicense, and then went on to consult firms and businesses seeking to navigate his regulatory handiwork.
Dudas is even naming names, “And let’s not pretend that the creation of $XRP (Ripples) was smooth. It was not, as we can see from this 2014 letter from @krakenfx CEO @jespow, one of the earliest members of the team and former Board member,” who describes the building of XRP as something approaching a stolen project.
“2016: ‘In addition to being the digital currency forerunner that issues and runs $XRP, a digital currency trailing only bitcoin in popularity, @Ripple is a developer and provider of Ripple Connect for major foreign financial institutions,'” he posts the very quotable company in an interesting chain of statements. Dudas claims SBI, for example, to be an 11% owner in Ripple.
He characterizes Ripple’s current public relations campaign as “revisionist history,” going on to rephrase the company’s unstated mission: “It is no longer cool for a centralized entity / company such as @Ripple to be associated with issuance of a cryptocurrency such as $XRP, as that may cause the @SEC_Enforcement team to become interested,” Dudas chastised.
As of this writing, Dudas is continuing to tweet up a storm, minutes ago updating, and is currently examining Ripple and XRP in light of the vaunted Howey Test … the standard by which the SEC uses to determine what is a security. So far, no comment from Ripple.
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