Ripple CEO Brad Garlinghouse said the contents of the company’s quarterly financial reports could take a different turn from the usual after the US Securities and Exchange Commission (SEC) used the firm’s disclosures against it in the lawsuit.
Meanwhile, XRP holders lawyer John Deaton believes Ripple’s transparency saved the firm from facing fraud and manipulation allegations.
Ripple Increases XRP Holdings in Q2 2023
Garlinghouse stated that the company voluntarily started releasing the quarterly reports on its XRP holdings as a sign of transparency but said the reports were used against it in the lawsuit while hinting that there could be changes in their format in the future.
We began these reports to voluntarily provide updates given our XRP holdings. Sadly, they were used against us in the SEC lawsuit – however, we remain steadfast in our commitment to transparency but I suspect they’re going to look a bit different moving forward https://t.co/oANR6WCG09
— Brad Garlinghouse (@bgarlinghouse) August 2, 2023
Ripple released its quarterly XRP markets report for Q2 2023 on July 31, which was different and focused on the landmark court ruling and misconceptions and also included the company’s XRP holdings.
As previously reported by CryptoPotato, the court ruled in favor of Ripple, with Judge Analise Torres declaring that XRP is not a security, in a case involving the SEC and Ripple Labs that dragged on for nearly three years.
The report also moved to debunk some of the misconceptions following the court’s decision. Ripple clarified that the ruling was not only a victory for the firm but for the broader crypto industry. The company also debunked a misconception stating that XRP is partially a security token, asserting that based on the judge’s ruling, the asset “is not in and of itself” a security.
Furthermore, the firm addressed the misconception that believed the ruling protected institutional buyers and not retail traders. According to Ripple, the decision focused on the reach of the SEC, while adding that the regulator’s claims to protect investors did the opposite.
As stated in the report, the SEC lawsuit in 2020 caused panic selling among investors, which led to a loss of $15 billion in market capitalization at the expense of US holders.
Meanwhile, Ripple’s XRP holdings at the end of Q2 2023, which ended on June 30, stand at 5,551,119,094, an increase from 5,506,585918 recorded on March 31. Also, the total XRP on ledger escrow was reduced from 42,800,000,013 at the end of Q1 2023 to 41,900,000,005 in Q2 2023.
Deaton on Ripple’s Transparency
While Ripple could change the format of its reports moving forward, XRP holders’ lawyer John Deaton believes the company’s transparency saved it from facing fraud and manipulation charges.
It is absolutely true that the SEC used the transparency of these reports against Ripple and its two executives. As a private company, Ripple was under no obligation to share this info. Other companies not only didn’t share token sales, but intentionally disguised those… https://t.co/mbAO6feEfW
— John E Deaton (@JohnEDeaton1) August 2, 2023
Deaton stated that Ripple published its quarterly reports even when it was not obliged to as a private company, while other firms hid token sales and deliberately disguised the transactions.
According to the lawyer, the SEC would have included fraud, misrepresentation, or manipulation charges in its lawsuit if the agency saw the possibility, adding, “When you’re transparent, they can’t claim fraud – even when they want to.”