Tetragon Financial, one of the key investors in Ripple, has filed a lawsuit against the company demanding the redemption of its preferred shares.
In 2019, the financial group Tetragon took part in a series C funding round, during which Ripple raised $ 200 million. Tetragon’s management filed a lawsuit in Delaware court, demanding that Ripple fulfill its contractual obligations and redeem the preferred shares held by Tetragon. The plaintiff seeks to freeze all of Ripple’s liquid assets until the issue is fully resolved.
Tetragon filed a lawsuit against Ripple after the US Securities and Exchange Commission (SEC) accused Ripple co-founders Brad Garlinghouse and Chris Larsen of running an unregistered ICO. The regulator believes that XRP are securities, and their sale was illegal.
Ripple’s discussions with the regulator led to the fact that many cryptocurrency platforms began to restrict trading in pairs with XRP and even completely exclude this coin from the listing. These included exchanges Coinbase, Bittrex, OKCoin and Bitstamp, OSL, Beaxy and CrossTower platforms, large market makers Jump Trading and Galaxy Digital, and payment company Simplex.
Ripple has responded to Tetragon’s allegations by saying the lawsuit has no basis. Ripple executives have accused Tetragon of taking advantage of a lack of regulatory clarity in the United States in filing the lawsuit. Earlier, Garlinghouse urged American regulators to study digital currencies in detail and draw up clearer rules for their regulation. Garlinghouse said that if the SEC does not clarify its attitude towards XRP, then Ripple may relocate from the US to the UK, since XRP is not considered a security in this country.
XRP has lost ground in terms of market capitalization amid lawsuits from the SEC and investors. According to CoinMarketCap, XRP has now dropped to fifth place after LTC, and XRP fell from $ 0.238 to $ 0.218 on January 5. The current rate of the coin is $ 0.242, but the upward correction is caused by the general growth of the cryptocurrency market.