Bitwise asset management, one of the largest cryptocurrency fund managers in the world, It has completely dumped its XRP holdings as part of regulatory action against Ripple.
In an official press release Bitwise announced on Wednesday, December 23, that its position in XRP was liquidated because its fund “does not invest in assets that are reasonably likely to qualify as securities under federal or state securities laws” .
“Bitwise’s decision to liquidate its position in XRP was based on consideration of new public information from the SEC’s lawsuit.”
Bitwise’s Cryptocurrency Index Fund was launched in 2017 to give institutional investors exposure to digital assets. The fund’s under-managed assets were over $ 100 million in October thanks to a large influx of advisors, families and hedge funds.
The price of XRP has been in freefall for the past few days after the US Securities and Exchange Commission announced it sued parent company Ripple for “offering unregistered securities for $ 1.3 billion.” “ The lawsuit set out in a detailed 71-page complaintis the culmination of a multi-year investigation by the US Securities and Exchange Commission.
The claim summary reads:
“From at least 2013 to date, the defendants sold more than 14.6 billion units of a digital asset called ‘XRP’ for cash or other consideration valued at more than $ 1.38 billion (‘USD’) for Ripple’s operations finance and enrich Larsen and Garlinghouse. “
Bitwise isn’t the only organization giving up the XRP trade. Smaller exchanges such as OSL, Beaxy and CrossTower have temporarily suspended trading with the token or have completely removed XRP from their offers.
The CEO of Ripple, Brad Garlinghouse urges investors and employees not to worry about the lawsuit, but stresses that the litigation could take a long time to end. Meanwhile, RippleNET has very little commercial activity in the US. This could theoretically enable the company to move abroad. Ripple has not indicated such a plan for the near future.