The current regulatory issues Ripple is currently facing is biting deep into its native token, XRP. Interestingly, crypto fund asset manager, Bitwise has stopped investment in Ripple. The company says it will not continue to invest in XRP and has removed its current positions.
No Longer Interested in XRP
In a recent press release, Bitwise said the XRP position in its Bitwise 10 Crypto Index Fund has been liquidated. The company made it clear that this decision stemmed from the fact that Ripple was having an issue with the SEC. Bitwise said the fund will not include assets that are ‘reasonably likely to be deemed securities’ under law.
The asset company explained the reason for taking this action further in its press release. “Bitwise’s decision to liquidate its position in XRP was based on consideration of new public information from the SEC’s complaint.” Bitwise also advised investors to think carefully about the XRP asset. It pointed out that if eventually, XRP became security, then it could affect both the fund and Bitwise.
The 10 Crypto Index Fund was started 3 years ago to provide an opportunity for instructional investors to access a variety of crypto. Before Bitwise let go of XRP, it made up about 3.8% of the total crypto index fund. The money made from the sale was put into other assets in the same portfolio.
What Happened to Ripple?
Ripple has been going through a tough time this week, following claims by the SEC that XRP is a security. Last Tuesday, the SEC filed a case against XRP in a New York Court, claiming it to be a billion-dollar unregistered offering. The SEC also argued XRP was subject to securities registration and laws like any other security.
The lawsuit immediately caused a lot of traders and investors to lose confidence in the token. As a result, the price of XRP has been plummeting steadily as more people sell it off. Brad Garlinghouse, the Ripple CEO, has asked investors and staff to calm down over the lawsuit. However, it looks like a lot of companies are turning their back on Ripple. Exchanges like CrossTower and OSL have delisted the coin, demonstrating the lack of confidence in it.