Why Ripple’s SEC lawsuit could have a lasting impact on crypto

Fortune
07/29/2021

Preston Byrne was recently quoted in a Fortune article entitled, “Why Ripple’s SEC lawsuit could have a lasting impact on crypto” where he briefly touches upon the history of the XRP token and its founders.

But that’s a wild stretch based on Ripple Labs trying to distance itself from its earlier incarnations as NewCoin and OpenCoin, said Preston Byrne, an attorney at law firm Anderson Kill specializing in cryptocurrency, who is not directly involved in the case. “XRP tokens didn’t spring out of the ground like gnomes,” said Byrne. “They were created by Ripple’s predecessor entity OpenCoin.”

In fact, notes Byrne, Ripple and its founders and managers have left their footprints all over XRP, and to this day many investors and institutions, including Nasdaq, refer to the currency as Ripple or Ripple XRP. He points out that while control over XRP is in fact somewhat decentralized, it’s not nearly as decentralized as Bitcoin and Ether. Ripple owns much of the software that remains essential to maintaining the smooth processing and validation of XRP transactions, as well as the financial network software that makes the most use of it. In that sense, the company’s success as a software developer could be seen as spilling into XRP’s value, a key element of failing the Howey test.

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Blockchain and Virtual Currency Attorney | Anderson Kill
Preston Byrne
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New York

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