Ripple’s token, XRP, is one of the most attention-grabbing tokens on the cryptocurrency market. Even after the passage of years it has managed to maintain an advantageous position among the altcoins in the top 10. One of the factors that may have influenced this was the accumulation of whales.
Major investors continue to believe in the potential of XRP, even after the SEC’s 2020 lawsuit began. At the time, the Securities and Exchange Commission accused the company behind the altcoin of having sold XRP in the form of securities.
According to the SEC, Ripple sold $1.3 billion in tokens illegally. After all, it had not registered XRP with the commission to make that sale.
Soon after the formal accusation, many cryptocurrency exchanges decided to take XRP out of their portfolio so as not to suffer from a possible lawsuit that would not be favorable to Ripple and negatively impact the crypto platform’s business. As a result, XRP lost much of its capitalization.
However, at the time of writing, neither side has been able to prove its case. Thus, since 2020, this process has dragged on without a definitive direction.
But something different has arisen in recent months. Big investors are accumulating XRP and putting it in their portfolios.
Why do whales keep accumulating XRP?
First, a big reason the whales are positioning themselves in XRP is the hope that Ripple may emerge as a big winner in the battle against the SEC. That is because the whole scenario shows a better finish for the payments company.
One of the documents mentioned, for example, is the speech by former commissioner William Hinman, former chairman of the SEC and responsible for opening the case against Ripple.
The speech contains comments about the legal status of Ethereum (ETH). Hinman expressed that the altcoin, like Bitcoin (BTC), is not a security.
The big dilemma is that Hinman could have favored ETH.
Between 2017 and 2018, four planned meetings with representatives of the market’s leading altcoin took place.
Therefore, lawyer John Deaton sees that the Ethereum team had privileged access to the SEC, something that no other protocol on the blockchain market had, as it was denied to all other fintechs on the crypto market.
In addition, Ripple’s general counsel mentioned that the SEC does not hold answers to its arguments in court. The blockchain company said that the commission has failed to prove the existence of any investment contracts governing the defendants’ offers and sales of XRP between the period of 2013 and 2020.
SEC is not only reason for whale interest
Many countries around the world are focused on launching their central bank digital currency (CBDC). Although the results have not been the best in recent months, with India as an example launching a CBDC that did not please bankers, XRP might be a major highlight in this area.
Although many crypto market investors are against governments, Ripple’s intention has always been to act in partnership with rulers, something that favors the company’s technology in CBDCs.
According to Brad Garlinghouse, Ripple’s CEO, the company has always had a goal of working with governments and regulators. The entrepreneur believes that his company can be used to benefit and spread technologies.