XRP token: Bullish news outpacing the Ripple hate

Popular cryptocurrency exchange Binance will be expanding its trading variety with the recently-crowned second most valuable project on the cryptocurrency market, XRP. They announced these news in a blog post published on December 24th. The move was publicized by Changpeng Zhao, the CEO of Binance, via his Twitter page:

“We will be adding a couple trading pairs with XRP as the quote currency shortly,” he said.

Binance explains that TRX/XRP and XZC/XRP will be the first XRP-based trading pairs added on the exchange. As part of the update, developers will rename the current Ethereum (ETH) markets to “ALTS,” with CEO Changpeng Zhao’s Twitter explaining that a lack of user interface space was the main reason for the move. The exchange adds that ALTS do not represent a new coin or token.

Zhao also commented on the future trading pair additions, confirming that the exchange intends to prioritize projects that contribute to Binance’s Blockchain Charity Foundation.

“We will prioritize adding more pairs for the projects that have donated to our charity at this (even though we never mentioned this during our fund raising efforts),” Zhao added.

XRP reacted well to these news, rising above 10000 satoshi for the first time this month.

Read: How to buy XRP

XRP holders are celebrating this as the spark for decoupling of XRP from bitcoin’s shackles. We will see if this will be enough for that to happen or will XRP need more power that would come mostly through listing on biggest fiat on-ramp in crypto, Coinbase. Ripple and Coinbase relationship is strained so that one will be much trickier to pull off.

Stuttgart Stock Exchange To List XRP on Upcoming Crypto Trading Platform

As CCN reports, the Bison App developed by Sowa Labs, a wholly-owned fintech subsidiary of Börse Stuttgart, the second largest stock exchange in Germany has announced plans to launch a cryptocurrency exchange platform with initial support for Bitcoin, XRP, Ethereum and Litecoin. Making the announcement in a post on its official Twitter account, Bison App revealed that the new service will go into its exclusive beta testing phase sometime in January 2019 in what will be a significant move for a platform owned by Europe’s ninth-largest stock exchange.

XRP added as base pair on BTCEXA

CoinDCX: Crypto Exchange‏ adds XRP as base pair

What is stopping XRP to dominate in 2019?

Regulation is the biggest question mark hanging above XRP head. If it gets cleared as non-security token, XRP price will go through the roof as that is perceived as the only real danger for the token at the moment. Ripple Labs is still very strong on the business side of things and partnerships are pouring in, the only missing link is regulatory certainty and passing of Howey test.

Let’s see how Ripple fares against the 4 questions asked by the Howey Test:

  • Is it an investment of money/assets?

The Ripple company specifically states that XRP is not an investment vehicle. Buying XRP does not give holders any rights within the Ripple company. The token is simply a digital asset created by Ripple and sold to institutions for its intended purposes.

  • Is there an expectation of profits from the investment?

The Ripple company has never promised that XRP will go up in value while people hold it. They never claimed that it will go up in value at all.

  • Is the investment of money/assets in a common enterprise?

There is no common enterprise involved, Ripple claims. Most federal courts define a common enterprise as one that is horizontal, meaning that investors pool their money or assets together to invest in a project.  While XRP can be bought on exchanges in transactions that don’t have anything to do with Ripple, it is important to note that around 80% of XRP is in the hands of the Ripple company. This is a bit of a gray area and Ripple are working with the SEC to fix the issue.

  • Any profit comes from the efforts of a promoter or third party

The final factor of the Howey Test concerns whether any profit that comes from the investment is largely or wholly outside of the investor’s control. If so, then the investment might be a security. If, however, the investor’s own actions largely dictate whether an investment will be profitable, then that investment is probably not a security. This is where XRP and Ripple are completely safe as the price of XRP is entirely determined by the people buying and selling it.

What would happen if XRP is declared as security?

Great post about this topic was posted on Reddit:

If XRP were to be deemed a security in the legal sense based in the United States, Ripple the company will be beholden to it’s “shareholders” and XRP ownership will represent ownership in the company. It will also put it into a classification that would make it incredibly difficult to fulfill its actual purpose of providing cross border liquidity due to the entirely separate legal framework around securities.

This shouldn’t be confused with the possible securitisation of futures contracts with XRP as the underyling asset. For instance, one could trade futures contracts on an underlying asset such as oil or corn or wheat. But that doesn’t mean buying wheat makes you an owner of the farm that produced it.

XRP should be classified as a digital commodity, or something similar, so it could fulfill its role of being a bridge currency between fiat. That is only one of its possible use cases, but the primary one being pushed at the moment.RodneyDDS

Read here about best wallets for storing XRP tokens .

All in all, XRP is a digital asset that has a real use case (unlike stocks aka actual securities that can only be held and traded). XRP ledger existed before Ripple and it was “gifted” to the company after it was founded. The Ripple company then used the XRP ledger to develop financial software around and has started selling this software to banks and financial institutions. Buying XRP doesn’t give you shares in Ripple and the price of XRP isn’t set by Ripple.

The biggest argument to calling it a security is XRP’s level of centralization. Ripple knows they are operating in murky waters as they do own a lot of the cryptocurrency which they designed and originally distributed. The efforts to become more SEC-compatible include decentralizing the total supply and creating separate brands for the digital token and the company. Ultimately, the token is a digital bridge asset meant for value exchange and it is almost certain that regulators will soon confirm that XRP isn’t a security as well.

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Sarah Wurfel
Sarah Wurfel

Sarah Wurfel works as a social media editor for CaptainAltcoin and specializes in the production of videos and video reports. She studied media and communication informatics. Sarah has been a big fan of the revolutionary potential of crypto currencies for years and accordingly also concentrated on the areas of IT security and cryptography in her studies.

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