It seems like the legal trouble for Ripple Inc. Keep on increasing. The company is now facing a class action lawsuit. According to the lawsuit, Ripple is actually a security for the California state law.
Another investor recently sued ripple stating that it is a security in spite of claiming to be a token. The name of the investor is Vladi Zakinov. He has stated in his lawsuit that since Ripple is directly sold to the public and anyone can buy ripple, it is actually a security. He is also stated that company is selling ripple in order to raise funding.
According to him, this was a clear indication that it is actually a security rather than a token. Also, he stated that the investors do not have any control over the fate of Ripple. This is the reason why the investments have a huge risk.
The investor has invested in ripple at a cost of about $ 1. The investor had invested in ripple expecting the huge returns. However, he stated that the company actually inflated the price of the token in order to lure the investors. As a result, the gullible investors invested at high prices and are currently facing a loss.
Moreover, the lawsuit clearly states that Ripple is using the cryptocurrency in order to fund its operations. This is the 2ndlawsuit which has been filed against ripple.
Previous lawsuit:
Earlier, Ryan Coffey had filed a class-action lawsuit. According to that lawsuit, Ripple is just increasing the tie-ups in order to inflate the value of XRP. It is running a never-ending ICO. Also, the lawsuit states that Ripple is not decentralized.
Moreover, the lawsuit stated that the company is trying to inflate the price of Ripple by consistently releasing positive news to the press. They are not doing anything in order to provide more security to the investors. They are just trying to create more demand by releasing more and more positive news to the investors.
Many other individuals will be able to join the lawsuit as it is a class-action lawsuit. They will be able to join the lawsuit until January 1, 2019. In the lawsuit itself, it is stated that the number of the investors are so many that it is not practical for each and every person to join the lawsuit.
According to the lawsuit, the plaintiff is seeking a full refund of the investment which they made in ripple. They are also seeking compensation for damages and other expenses. This clearly indicates that the problems for Ripple are increasing at a rapid pace. If indeed, it is considered as a security by the court, it will open up gates for further litigation.
