After Coinbase says it will stop trading following the SEC complaint against Ripple, Crypto token XRP drops to as much as 31 percent
- After the Coinbase trading platform said it would suspend its trading by mid-January, the cryptocurrency XRP dropped as much as 31 percent on Tuesday.
- Last week, a lawsuit against the blockchain firm Ripple about how it sells XRP was filed by the US Securities and Exchange Commission.
- In six weeks, XRP lost roughly three-quarters of its value.
- For more stories, visit Business Insider's homepage.
The cryptocurrency XRP dropped as much as 31 percent on Tuesday after the trading platform Coinbase said it would completely suspend the digital token from its marketplace by mid-January. That followed a complaint against XRP's maker, Ripple Labs, from the US financial-markets regulator.
XRP was down 28 percent on the day, to around $0.2018, having fallen earlier in the day to a session low of $0.2011. Since reaching a two-year high in early November, XRP has lost around 75 percent in value, as investors took advantage of a weaker US dollar to pile up into cryptocurrencies.
On Wednesday, the US Securities and Exchange Commission said that Ripple had effectively run an unregistered $1.3 billion offering with its XRP sales, which the regulator considered a security and not a cryptocurrency.
"In light of the SEC's lawsuits against Ripple Labs, Inc, we have made the decision to suspend the XRP trading pairs on our exchange," Coinbase said in a statement late on Monday.
"Trading will shift into limit only starting December 28, 2020 at 2:30 PM PST, and will be fully stopped on Tuesday, January 19, 2021 at 10 a.m. Pacific Standard Time," the company said.
Coinbase added that the suspension of trading would not impact access to XRP wallets by customers and that these would remain available for deposits and withdrawals.
Bradley Garlinghouse, CEO and co-founder of Ripple, who is named in the SEC suit, said on the company's blog last week that the regulator had not given the firm clarification on whether its XRP token should be treated as a currency or a safe.
When approached by Business Insider, Ripple was not immediately available for comment.