SEC Calls For Investigations Into Ripple Employees’ Slack Messages
The United States Securities and Exchange Commission has asked the court to order Ripple to submit its employees' Slack communication app history.
SEC Requests Access To Over 1 Million Messages
SEC's attorney Jorge Tenreiro filed a motion seeking access to over 1 million messages sent by Ripple's employees. The SEC is specific, though. It seeks access to the team's Slack messages.
According to the regulator, the defendants agreed to search all messages initially. However, they ended up with access to a limited 1,468 messages. The SEC revealed that the messages which have already been produced yielded critically important information.
Yet, the blockchain firm has refused to provide access to the rest of the messages after blaming its initial reluctance to cooperate on data-processing errors. The SEC said,
“Ripple agreed at the outset of discovery to search for and produce responsive Slack data but now, in the waning days of fact discovery, suddenly refuses to do so on the basis of Ripple's mistakes in gathering that data.”
So far, the chats that the SEC has access to hover around Ripple's desire to create speculative XRP trading and the company's concerns about the XRP price. The impact of XRP sales on Ripple's business and the cryptocurrency's regulatory status is also points touched on in the messages.
Ripple has since asked that it be given until August 16, 2021, to respond to the motion.
The Ripple And SEC Battle Continues
The case between Ripple and the SEC started in December 2020. The regulator had alleged that the firm and its executives conducted unregistered securities offerings with their XRP token sales.
Since then, the SEC has maintained its stance while Ripple insisted that it had done nothing wrong.
This is not the first time the SEC would try to get in on Ripple's records. Last month, Magistrate Judge Sarah Netburn denied the SEC access to Ripple's legal communications. She also declined the SEC's motion to suppress the deposition of former SEC official William Hinman–an official who had previously asserted that Ethereum was not a security.
Ripple continues to argue that the XRP should be treated as a commodity offering like Bitcoin and Ethereum. In April, Ripple won a discovery ruling that required the SEC to produce internal documents about its discussions of Bitcoin and Ethereum. BTC -4.13% Bitcoin / USD BTCUSD $ 42,591.99
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Ripple CEO Brad Garlinghouse has also reiterated this stance several times that XRP is not a security. In an interview with Fox News earlier this year, Garlinghouse said that XRP is an open-source technology and not a security. He described the similarities between XRP and Bitcoin while adding that the fact that BitPay, one of the leading payments firms, supports XRP is one example of how the token is not a security.