Coinbase, one of the largest cryptocurrency exchanges, announced it will suspend XRP trading in January 2021. This decision follows the U.S. Securities and Exchange Commission (SEC) lawsuit against Ripple Labs, the creator of XRP.
Key Details of the Suspension
- Trading Halt Date: Full suspension begins January 19 at 10:00 AM PT.
- Partial Restrictions: Some trading limitations started December 28.
- Price Impact: XRP dropped over 60% in 10 days post-lawsuit announcement.
Background: SEC Lawsuit Against Ripple
The SEC alleges that Ripple's CEO and former CEO failed to disclose critical risks about XRP to investors. Ripple contends that XRP is a currency, placing it outside SEC jurisdiction. The legal uncertainty has prompted multiple exchanges to delist or suspend XRP trading.
"Customers remain eligible for the Spark airdrop (subject to regional approvals), and XRP will still be supported on Coinbase Custody and Wallet."
—Coinbase Official Statement
Market Reactions and Data
- Current XRP Price: $0.22 (as of reporting) with a 24-hour trading volume of $9.05 billion (CoinGecko).
- Exchanges Following Suit: Bitstamp, OK Coin, CrossTower, and others also paused XRP trading post-SEC action.
User Implications
- Deposits/Withdrawals: Allowed via XRP wallets during suspension.
- Trading: No new XRP trades can be initiated on Coinbase after January 19.
FAQs
1. Why did Coinbase suspend XRP trading?
Coinbase acted in response to the SEC lawsuit against Ripple, which created regulatory uncertainty around XRP’s status as a security.
2. Can I still withdraw my XRP from Coinbase?
Yes. Users can deposit/withdraw XRP via wallets even after the trading halt.
3. Will XRP be relisted if the lawsuit resolves favorably?
Exchanges may reconsider based on legal outcomes, but no official plans have been announced.
4. How does this affect the Spark airdrop?
Coinbase confirms eligibility for the Spark airdrop where approved, regardless of the trading suspension.
5. What other exchanges delisted XRP?
👉 Bitstamp, OK Coin, and others halted XRP trading following the SEC action.
6. How far has XRP fallen since the lawsuit?
XRP lost 60%+ of its value within 10 days of the SEC’s December 2020 complaint.
Broader Impact on Crypto Markets
The SEC’s case against Ripple highlights regulatory risks for cryptocurrencies with centralized governance. While Bitcoin and Ethereum are deemed decentralized (and thus not securities), XRP’s ties to Ripple Labs made it vulnerable. This event underscores the importance of regulatory clarity for blockchain projects.
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