Kraken has become the most recent cryptocurrency exchange for suspending trading on the XRP token in light of the U.S. SEC’s lawsuit against Ripple and two of its executives. Nevertheless, this decision correlated to trading of U.S. consumers, which will be operative on January 29, 2021. The non-U.S. consumers remain unaffected and can trade all cryptocurrencies and derivatives of such assets. The latest developments do not influence clients staying in other nations. As of last year, Kraken provided its services to 48 U.S. states and 176 countries.
Kraken stated that the trading suspension would not influence consumers’ access to deposit, hold, and withdraw XRP after halting the trading. Those with spot positions on margin must fulfill any outstanding margin responsibilities by the close of January 28 or face liquidation. The exchange will make additional changes to this arrangement, relying on Ripple and the securities regulator case’s outcome.
Various High-Profile exchanges halt XRP trading
Kraken isn’t the only high-profile exchange to halt XRP. Various other exchanges such as Coinbase, Bitstamp, and OKCoin have made the same decisions following the SEC’s legal action. XRP price has plunged another 5% today as more exchanges and associates distanced themselves from the fourth-largest crypto asset by market capitalization. As published, the SEC’s lawsuit was filed against Ripple CEO Brad Garlinghouse and Co-founder, Chris Larsen. It declared that they raised $1.3 billion through ongoing, unregistered securities offerings since 2013.
However, Ripple told it would defend the charges. The SEC’s legal battle could take ages if the company fights the accusation in court. As such, those who hold the token listed on their platforms may be in danger of being sued and penalized. That will only happen if the SEC wins its case as the court considers XRP unregistered securities.
Following the SEC’s lawsuit, Kraken was conscious about linking with the illegal assets. The exchange carries approval from a state regulator in the U.S. to start a crypto bank under an SPDI charter. An SPDI bank charter authorizes Kraken to conduct an independent bank that will decrease dependence on third-party financial institutions and enables the exchange to offer deposit-taking, custody, and fiduciary services for digital assets.
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