Investors completed a class action lawsuit against a blockchain startup. They claim that Brad Garlinghouse He positioned himself as a “Hodler” and described his position as “very, very long”, but in fact he gradually realized his altcoins.
related article: He was bullied at school but now lives a lavish lifestyle thanks to trading in Bitcoin and other cryptocurrency
The class action lawsuit against Ripple was supplementedaccusations against the head of the company Brad Garlinghouse. Investors claim that he promoted XRP tokens and at the same time sold them himself. In 2017, Garlinghouse described his position as “very, very long,” and called himself a “clerk,” the case file says. In fact, the CEO of the blockchain startup sold 67 million XRPs in a year, and he did it within a few days of receiving it from Ripple, claimants say, Cointelegraph reports.
related article: Australian investor bought a 2,800sqm property in Charleville with money he earned by innovative financial tool
Investors believe that Rippe and GarlinghouseXRP is tricked into promoting an “intermediate currency” in order to avoid its classification as a security. The plaintiffs are sure that the company specifically violates the relevant legislation, but at the moment, American financial regulators, such as SEC and CFTC, did not recognize the blockchain startup token as a security.
“False claims about the practical value of XRP are nothing more than an attempt to evade the application of securities laws and increase demand for a token,” the statement said.
Garlinghouse said earlier that the company depends onXRP implementation no less than from other sources of funding. Ripple would not have profits and could not have maintained a positive balance if it had refused to sell tokens, says the CEO of the company.
This contradicts the words of Ripple CTO David Schwartz. In December last year, he said that a blockchain startup never depended on XRP token sales.
The case against the company from San Francisco was reopened in February 2020. Plaintiffs were allowed to file a second statement regarding the violation of the Ripple Securities Act.