Coinbase, one of the cryptocurrency market’s most well-known exchanges, said on Monday that it would suspend trading in XRP (XRP-USD), following a decision by US regulators last week to charge blockchain firm Ripple with conducting an unregistered securities offering.
The company said on Twitter that the suspension would take effect on 19 January 2021.
The company’s chief legal officer Paul Grewal noted in a blog post following the announcement that “trading may be halted earlier as needed to maintain our market health metrics.”
“Our decision to support any asset or functionality requires significant technical and compliance review and may be subject to regulatory approval in some jurisdictions. We therefore cannot guarantee when or if the services mentioned in this post will be available in any specific jurisdiction at this time,” he wrote.
Given the SEC’s recent action against Ripple, all XRP books have been moved to limit only and Coinbase plans to fully suspend trading in XRP on Tuesday, January 19, 2021, at 10 AM PST. Afterwards, users will continue to retain access to their XRP funds. https://t.co/izreZvgHNl
— Coinbase (@coinbase) December 28, 2020
Coinbase’s move comes as it gears up for a stock market listing. The list would make it the first major crypto exchange in the US to go public.
The exchange has more than 35 million users in more than 100 countries.
XRP, meanwhile, is used for cross-border money transfer and has become popular with crypto investors who see it as potentially revolutionising the money exchange business.
It has risen to become the third most valuable cryptocurrency in the world, behind bitcoin (BTC-USD) and Ethereum (ETH-USD). XRP has a market cap of $20bn (£14.9bn) and Ripple was valued at $10bn in its last funding round in 2019.
Last week, Brad Garlinghouse, chief executive of Ripple, said in a statement that the US Securities and Exchange Commission (SEC) was preparing to sue his company over the sale of XRP.
A week ago, the price of XRP tumbled after the company that created it said US regulators were about to file a lawsuit against the business.
The price of XRP dropped more than 6% against the dollar on the day.
On Tuesday morning in London it slipped as much as 16% by mid-morning.
The news comes amid a rally in rival currency Bitcoin (BTC-USD) that saw the value of its tokens in circulation reach half a trillion dollars. Bitcoin has risen around 50% to the dollar since the week before Christmas.
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