David Schwartz, who is the Chief Technology Officer of Ripple, discussed on Twitter the ongoing discussion about the purpose and character of the sales of XRP.
According to Schwartz, Ripple was established to distribute XRP in a widespread manner and generate enough revenue through sales to keep the company running in case of need.
The ongoing debate on the nature of XRP sales is happening during a legal case where the US Securities and Exchange Commission (SEC) is suing Ripple. The SEC alleges Ripple violated securities laws by selling XRP without proper registration. According to the SEC, Ripple and its executives, including CEO Brad Garlinghouse, raised more than $1.3 billion through these sales.
In the past, Garlinghouse acknowledged that XRP sales had been instrumental in keeping Ripple afloat, leading to doubts about the company’s dependence on these sales for income. Garlinghouse had stated to the Financial Times that the company would incur losses without selling the contentious token.
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Detractors claim that Ripple’s reliance on XRP sales suggests that the company lacks a sustainable business plan, leading to skepticism regarding the legitimacy of the cryptocurrency. The ongoing discussion on Twitter centers around whether XRP was initially designed for retail sales or not.
The resolution of the SEC’s lawsuit against Ripple could have substantial consequences for the future of XRP and the wider cryptocurrency industry. The case is expected to conclude in the year’s first six months.
The final decision on whether these sales of XRP were done legally, as well as the potential repercussions for Ripple and the overall cryptocurrency market, are still unclear.