Can the Ripple lawsuit be traded with Wrapped XRP to circumvent XRP delisting in US?

Rick Steves

wXRP is a derivative product that is pegged to the digital asset that the SEC claims to be a security in what has been dubbed “the cryptocurrency lawsuit of the century”.

As is widely known among XRP investors and the crypto trading industry, US-based digital asset exchanges have delisted XRP to avoid being targeted by the Securities and Exchange Commission as the agency entered a court battle against Ripple.

Crypto trading platforms kept that decision even despite the “bombshells” by Judge Netburn described by attorney Jeremy Hogan last year, including when she questioned whether “everyone who sold XRP – including you and me – are selling illegal securities”, to which the SEC attorney Jorge Tenreiro replied by saying that, under Section 4 of the Securities Act, only Ripple and its affiliates (meaning employees, Hogan said) could be accused of illegal sales. According to that argument, exchanges could resume the trading of XRP.

XRP delisted in the United States

Park Bramhall, senior counsel at Lowenstein Sandler LLP, had a different perspective: “The fact that the SEC has apparently stated that parties other than Ripple and its affiliates can resell XRP under Section 4 of the Securities Act doesn’t mean that exchanges are free to relist XRP,” he told Coindesk at the time.

“What the SEC appears to be saying here is that, in its view, parties other than Ripple and its affiliates can rely on the exemption from registration provided under Section 4(a)(1) of the Securities Act for resales of XRP, and that exemption is only relevant if XRP is deemed to be a security.”

The truth of the matter is that XRP will likely remain delisted in the United States while the Ripple lawsuit lingers, but there might be a way in for US investors who look to trade the news stemming from the court battle in New York.

FX and CFD brokers must go multi asset: Join free webinar from TraderEvolution to learn how

Wrapped XRP is a derivative product

Wrapped XRP (wXRP) has recently joined the Ethereum network. wXRP is a token pegged to XRP that can be used on blockchains other than XRP Ledger. The wrapped asset is exchangeable 1:1 with XRP held in reserve by a custodian that facilitates wrapping XRP and unwrapping wrapped XRP.

wXRP is a derivative product that is pegged to the digital asset that the SEC claims to be a security in what has been dubbed “the cryptocurrency lawsuit of the century”.

The outcome of the court case will have direct implications on Ripple and XRP, although these two words are not interchangeable. The precedent will likely dictate the course of the crypto ecosystem in the United States and potentially across the globe, given the country’s influence.

While investors outside the United States are free to trade XRP, that does not apply to US residents at the moment, but buying and selling Wrapped XRP would go under the scope of the CFTC as derivatives trading.

Ripple does not seem to be willing to give in to the SEC, so we’ll be likely following the case to the bitter end in August – September, according to attorney Jeremy Hogan.

Binance integrates wXRP

As part of the Wrapped XRP rollout, Binance has completed the wXRP integration and has opened deposits for wXRP on Ethereum (ERC20). The crypto exchange will open withdrawal for wXRP on Ethereum Network (ERC20) on a later date.

wXRP deposits will be credited as XRP and it is ready for trading. Withdrawals of XRP on Ethereum Network (ERC20) will be wXRP.

Read this next

Digital Assets

Ripple’s Metaco joins Zodia Custody’s network for connectivity with Layers 0 and 1

“As the industry undergoes a pivotal transformation, our networked infrastructure is dedicated to standardise, govern and connect institutional digital asset flows — an essential step in forging use cases that transcend individual companies.”

Retail FX

BDSwiss Unveils Dynamic Leverage and Zero-Spread Account for Enhanced Forex Trading

Experience a new era in forex trading with BDSwiss, a leading player in the industry, as it introduces two groundbreaking enhancements designed to elevate traders’ experiences on its platform.

Retail FX

Plus500 joins Futures Industry Association as US operations expand

Plus500 Ltd (LON:PLUS) has become a primary member of the Futures Industry Association (FIA) in the United States. The membership supports Plus500’s plans to expand its US business, positioning itself within the world’s leading trade organization for futures, options, and centrally cleared derivatives markets.

Market News

Weekly data: Fiber and Gold price action 

This preview of weekly data looks at EURUSD and XAUUSD where economic data coming up later this week are the main drivers in the markets for the near short term outlook. 

Market News

Unveiling the Top Performers in December 2023: A Stock Market Overview

As we approach the end of 2023, the dynamic landscape of the stock market unveils a year marked by high-profile events, from the resurgence of tech stocks to the demise of financial institutions.


Avelacom enhances connectivity across Middle East and East Asia

“Network latency is a critical factor in their operations across multiple, fast-moving markets where seizing arbitrage opportunities instantaneously is essential. We are dedicated to continually optimizing our global network paths. Our London to Tokyo route, a flagship for Avelacom, has been upgraded alongside other key markets in Asia, India, Turkey, and the Middle East.”

Institutional FX

DMALINK adds Commerzbank to its FX streaming service

“The inclusion of Commerzbank stems from ongoing client demand, achieving our core objective of providing data-driven institutional FX liquidity in a variety of trade sizes to users of any of our platforms looking to access primary markets efficiently.”

Institutional FX

Citi taps Traydstream to streamline trade documentation for its clients

Traydstream specializes in intelligent data extraction using AI and optical character recognition. Its technology significantly reduces the time needed for document checks in trade transactions, leveraging a machine-learning engine with an extensive rule database.

Retail FX

Greenwood launches mobile trading app for the Black and Latino communities

To encourage first-time investing, Greenwood will provide $10 to users, which can be used towards stocks and ETFs on the Greenwood Invest platform