The Fund’s XRP holdings represented 3.8% of its total portfolio. Jump Trading and Galaxy Digital will not offer support for trading XRP.
Management company Bitwise Asset Management’s cryptocurrency investment fund Bitwise 10 (BITW) announced on Wednesday that it liquidated its position in XRP that comprised 3.8% of its holdings. The move comes after US regulators accused Ripple Labs Inc. and its top executives of selling more than $ 1 billion in unregistered securities.
Before liquidating its position, XRP was among the 10 crypto assets that played a protagonist role in the mutual fund. Through a statement, the, the company redistributed the income to other assets. The fund mainly owns bitcoin, ethers, litecoin, among other cryptocurrencies, as reported in a statement.
An excerpt from the official statement notes that the Bitwise fund “does not invest in assets that have a reasonable probability of being considered securities under federal or state securities laws. The decision to liquidate the position in XRP sets its structure on a piece of new public information about the SEC complaint. “
Bitwise’s decision to liquidate its funds in XRP is just one of the series of consequences that have come from the lawsuit that the United States Securities and Exchange Commission (SEC) filed on Tuesday. His complaint centers on Ripple raising at least $ 1.3 billion through the sale of XRP without first registering it as a security.
Ripple denied the allegations, but the effects immediately began to show. They first hit the XRP price, which plummeted 30% to a price of 26 cents. Its weekly loss fell to more than 50%, losing more than $ 10 billion from its market capitalization.
Other consequences of the SEC’s lawsuit against Ripple
Subsequently, two of the largest trading desks in virtual assets have alerted their clients that they will stop making markets in XRP. The Jump Trading platform, known for providing liquidity to exchanges, told its counterparts that it will no longer provide liquidity to XRP. Also, the investment fund Galaxy Digital has suspended the trading of the digital asset until further notice, as revealed by sources that The Block recently consulted.
On the other hand, the global money transfer service MoneyGram, in a statement released on Wednesday also marked distance with Ripple. The company noted that it has never used the services of Ripple, On-Demand Liquidity (ODL) and RippleNet, for forex transactions.
In June 2019, Ripple and MoneyGram established a strategic partnership for cross-border payments. As part of the collaboration, Ripple was to invest up to $ 50 million in exchange for MoneyGram shares.
However, the company added in its statement that “MoneyGram has continued to use its other traditional currency trading counterparties during the term of the agreement with Ripple, and does not depend on the Ripple platform to fulfill its currency trading needs.”
By: Jenson Nuñez.
