It has been revealed that according to JPMorgan, Ripple’s XRP ruling means victory for Coinbase. Check out the latest reports about this below.
JPMorgan says Ripple’s XRP ruling means victory for Coinbase
JPMorgan believes that the recent ruling on Ripple’s XRP token is advantageous for Coinbase, as it reduces the cryptocurrency exchange operator’s potential losses.
“The ruling appears on the surface to be a win for Coinbase in its recent lawsuit by the SEC,” JPMorgan equity analysts led by Kenneth Worthington wrote in a report on Friday.
“We see Coinbase in the best position to benefit from the improved confidence and regulatory clarity given Coinbase’s market-leading position and respected reputation in the industry.”
This week, Ripple received a partial victory in court. A federal judge ruled that their XRP token is not considered a security when sold on the secondary market. However, it is considered a security when sold to institutional investors.
This ruling is beneficial for Coinbase since it may apply to the 13 tokens that the United States Securities and Exchange Commission claimed were securities in their lawsuit against the company last month. According to JPMorgan analysts, this ruling could potentially help Coinbase’s case.
“If the Ripple case stands, it would appear more challenging for the SEC to demonstrate the 13 [tokens] are securities and that Coinbase is an unregistered securities exchange thus excusing it from certain future licensing and regulatory requirements,” the analysts wrote.
According to analysts, although the Ripple ruling reduces the potential loss for Coinbase, it does not provide any significant additional benefits for the company.
That is because Coinbase’s staking and wallet products are also part of the SEC lawsuit, and thus, it would appear that “Coinbase is not ‘out of the woods’ completely just yet,” they noted.
“Furthermore, the SEC can appeal the Ripple decision furthering the uncertainty of the implications of the Ripple judgement.” JPMorgan has a neutral rating on Coinbase, per the report.
Overall, JPMorgan analysts “remain bullish on the cryptoecosystem longer term,” and they are “encouraged by some certainty from this ruling that contributes to the mosaic of the U.S. regulatory crypto landscape.”
