As you probably know by now, Ripple and the SEC have been battling for quite a while now. The SEC alleges that XRP is a security and Ripple’s chiefs are making sure to note that this claim is false.
The online publication the Daily Hodl notes that ccrypto legal expert Jeremy Hogan just addressed Ripple’s strongest defense against the SEC in the lawsuit involving XRP.
Ripple is accused of illegally issuing XRP to investors as a security and alleges that the token is still one today.
The price of XRP is tied to other cryptos
In a new AMA (ask me anything) video, Hogan addresses how the price of XRP is correlated with other cryptos such as BTC or ADA.
He said that if XRP were security, the price of the coin should only be tied to Ripple’s actions and not the performances of other coins.
He said that this is the most powerful proof that XRP is not a security.
“As you are aware, the SEC has to prove that XRP is a security, and one thing it will have to show is that its retail purchasers – me and you – are looking to Ripple to increase the value of XRP, and what this paper shows is that the price of XRP is not really correlated to anything Ripple does. In other words, Ripple ended its partnership agreement, for example, on March 9th with Moneygram and nothing happened to XRP’s price. However, according to this research paper, the price of XRP is heavily correlated with Cardano. 71% correlated according to the experts…” he said.
Ge continued and said that “Ripple has briefly touched on this part of their defense, but this is the first time I’ve seen that it correlates so strongly with Cardano. Very interesting.”
He also pointed out the fact that “Ripple can announce a great business deal, the XRP price won’t budge much. But if the price of Cardano falls 10%, you’d expect to see the price of XRP fall 7.1%. That is not how a security acts. I really hope that Ripple has good expert witnesses lined up and statistical correlation.”