The legal dispute between #Ripple and the US Securities and Exchange Commission (SEC) over the #XRP #cryptocurrency may have seriously hampered its growth in the American market. This was clarified by cryptocurrency attorney John Deaton in a post that was published earlier today on X (formerly known as Twitter), outlining the implications of the SEC's lawsuit on the adoption of XRP in the US.

How long is 3 years in cryptocurrency years?

Many frequently overlook how extensively Coinbase marketed #XRP before to the case.

… https://t.co/1fZ3r8WCSd pic.twitter.com/GLu4kFUU38

August 22, 2023 — John E Deaton (@JohnEDeaton1)

The remarks come at a time when debates about regulatory clarity in the cryptocurrency space are more heated than ever, with token holders pushing for clearer regulations in the North American nation.

The Coinbase Relationship

Until legal issues emerged, Deaton claims that Coinbase, one of the first cryptocurrency exchanges in the US, was at the forefront of pushing XRP. Deaton emphasised that Coinbase proactively contacted the SEC for clarification prior to listing XRP.

Coinbase presented its regulatory framework for assessing digital assets during a meeting in January 2019; this methodology had previously won praise from top SEC personnel. The SEC expressed no concerns, therefore Coinbase went ahead and listed XRP the following month.

In fact, Coinbase requested and received a meeting with the @SECGov in January 2019 to SPECIFICALLY DISCUSS THE REGULATORY STATUS OF #XRP!

The SEC was informed by Coinbase that it has assessed #XRP and put it through its rigorous regulatory framework for digital assets.

August 22, 2023 — John E Deaton (@JohnEDeaton1)

Additionally, the information wasn't limited to Coinbase. MoneyGram, a major provider of payment processing services and a partner of Ripple for remittances, announced its plans to connect with the XRP Ledger through a formal filing with the SEC.

MoneyGram didn't receive a complaint from the regulatory body either, similar to the Coinbase case, but the resulting legal dispute prevented the business from moving through with its plans.

The Controversy Lawsuit and XRP's Repercussions

In contrast to these preliminary discussions, the SEC sued Ripple in December 2020. Deaton underlined that XRP was examined by a number of industry participants, including the attorneys at MoneyGram and Coinbase, who concluded it was not a security. The SEC's complaint against Ripple, however, presented a different picture.

Incredibly, on December 22, 2020, less than two years after Coinbase spoke with the SEC regarding XRP and 18 months after MoneyGram revealed to the SEC that it was using #XRP, and despite attorneys at the SEC not determining that constituted a security in the...

August 22, 2023 — John E Deaton (@JohnEDeaton1)

The impact of the subsequent legal dispute spread throughout the cryptocurrency sector. It sparked arguments about the characteristics of cryptocurrencies and how they are categorised in the US as well as concerns about the regulatory environment.

Although Ripple has seen great success outside of the US, Deaton emphasised that the litigation unquestionably prevented the adoption of XRP in that nation.

Deaton believed that the information accumulated over the previous three years indicated that the lawsuit could have been a component of a plan. The impact on XRP's uptake in the US and the larger crypto market has been noticeable, even though it is yet speculative to determine the precise reasons for the SEC's actions.

As Deaton put it:

It is quite evident that the lawsuit was a tool. When I filed the Writ of Mandamus against the SEC, only 9 days after the Ripple case, I made this claim in a federal pleading, and the three years' worth of evidence have proven me right.