Ripple Expects US Banks and Financial Institutions to Consider Using XRP Following Latest Ruling in SEC Lawsuit
Ripple hopes that many US banks and financial institutions will approach the company this quarter.
US-based payment protocol Ripple believes XRP will now become a magnet for US banks and other financial institutions, following the recent development in its legal battle with the SEC. The company and the Securities Commission have been in court since December 2020, over the sale of unregistered XRP tokens. The lawsuit also involved two Ripple executives – Kristian Larsen and Bradley Garlinghouse. The long-awaited lawsuit resulted in various arguments before a judge awarded Payment Protocol a partial victory last week.
The matter between the commission and Ripple took a new turn when a New York judge declared that XRP itself “is not necessarily a security at face value.” This offset the regulator’s claims against the company over the past three years. While the SEC accused Ripple of not registering XRP as a security, the payment protocol argued that the token cannot be considered a security and is more like a commodity. The team said that XRP is used in its business to conduct cross-border transactions between banks and other financial institutions.
As a result of the lawsuit, Ripple faced some setbacks in its business. However, Ripple is confident that it is about to see a positive turnaround as US banks seek to use the XRP cryptocurrency after a recent update in its battle with the Securities and Exchange Commission. The company said that financial institutions will start to want to use their cryptocurrency assets for cross-border transactions.
Talking to CNBCRipple General Counsel Stu Aldrotti said Ripple expects to start discussions with financial firms in the US about using its on-demand liquidity (ODL) product, which uses XRP to transfer funds. According to Alderotti, the conversation will begin in the third quarter of 2023.
Hopes are high for what the news will bring to Ripple after it lost some of its trading partners. In the midst of its legal battle with the SEC, US financial services company MoneyGram finished its business relationship with Ripple in March 2021. While the companies did not specify the reason for the farewell, many indicated that it was due to an SEC attack. At the time, Garlnghouse said both parties were open to revisiting the relationship in the future. Could it now be “the future”? Could MoneyGram be one of the US financial services providers that will start showing interest in Ripple after the landmark ruling on the SEC order? The general counsel said:
“I think we hope that this decision will give clients of financial institutions or potential customers the comfort of at least coming in and starting to have a conversation about the problems they’re having in their business, the real-world problems in terms of moving value across borders without incurring outrageous fees.”
In addition, Ripple hopes that many US banks and financial institutions will approach the company this quarter. Alderotti said he hoped such talks would lead to actual business.
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Ibukun is a crypto/financial writer interested in passing on relevant information, using uncomplicated words to reach all types of audiences. Apart from writing, she loves watching movies, cooking, and exploring restaurants in the city of Lagos where she is staying.
