Connect with us

Regulation

SEC Wants More Slack Messages from Ripple as the Legal Battle Continues

mm

Published

 on

SEC Logo

The legal battle between the US SEC and Ripple, the company that created the XRP, does not seem to be anywhere near its end. In fact, the US financial regulator has just requested a massive amount of Slack communication records, as the messages it was granted previously seem to be missing a massive amount of data.

The SEC recently filed a motion with the Southern District of New York, requesting access to more of Ripple’s internal communications. The request was sent to Judge Sarah Netbrun, who was asked to order Ripple to surrender its employee messaging records.

The SEC believes that there is a lot more data regarding these messages that were sent via a business communication platform known as Slack, and it now wishes to get ‘terabytes of data that it assessed is missing, according to Ripple’s attorney, James Filan.

Some may remember that the SEC put in such a request before and that Ripple did produce Slack messages to honor that request. But, the SEC believes that the data is incomplete. After some time, Ripple admitted this to indeed be the case, claiming that the issue emerged due to a data processing mistake. Before admitting to the supposed error, Ripple repeatedly claimed that the Slack production was, in fact, complete.

The SEC was not fooled, however, and it continued to claim that it was granted access to only a small portion, with a massive quantity still remaining. The agency’s new filing says that Ripple’s data error, as well as its refusal to surrender more documents, has already caused a lot of suspicion. The regulator already deposed as many as 11 Ripple witnesses by using the produced records, which are considered incomplete. To get a full picture of what has been going on within Ripple for all these years, the regulator now wants the rest of the messages.

Just how much data is missing?

If the SEC is correct in its assumption, then the missing documents include more than 1 million messages. The regulator believes that this is terabytes upon terabytes-worth of data. The assumption was based upon the common knowledge that the company’s employees used Slack messages for communication on regular basis. In fact, it has been said that Ripple employees communicated via Slack at least as often as they did via email.

The regulator also justified its request by saying that even the small amount of Slack messages that was produced by Ripple initially has been a huge help in getting to the bottom of the issues surrounding the company and its cryptocurrency. The SEC claims that the messages have already yielded some critically important information that could not be found in the emails, nor in the official documents that the company has provided as per earlier requests.

So, naturally, the SEC has great hopes for this source of information regarding the internal workings of the company and is likely not going to give up on its pursuit of this data.

Ripple’s response

As for Ripple, the company reacted quickly to the new filing by filing its own request. Ripple requested that the deadline for responding to the SEC’s motion gets extended by four days. Originally, the company was requested to submit the information by Thursday, August 12th. However, the firm would like to move the deadline to next week’s Monday, August 16th.

Meanwhile, the Ripple community made its own conclusions from the request. One example is Attorney Jeremy Hogan, who is quite popular among Ripple fans. He suggested that the regulator’s latest motion is another effort to try and prove that the company’s coin, the XRP, should be treated as a security. As such, he claims that the motion was filed in order to ensure that the judgment of the cryptocurrency should fall under the commission’s jurisdiction.

He called it ‘attacking from the flank and arguing Ripple marketed and treated XRP like a security, and therefore it is.’ Now, the SEC did have success with this argument previously, and so it is not surprising that it decided to stick to this strategy. But, Hogan himself continues to claim that XRP is not even like security, let alone actually being one.

Ali is a freelance writer covering the cryptocurrency markets and the blockchain industry. He has 8 years of experience writing about cryptocurrencies, technology, and trading. His work can be found in various high-profile investment sites including CCN, Capital.com, Bitcoinist, and NewsBTC.

Newsletter Subscription

Advertiser Disclosure: Securities.io is committed to rigorous editorial standards to provide our readers with accurate reviews and ratings. We may receive compensation when you click on links to products we reviewed.

ESMA: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Investment advice disclaimer: The information contained on this website is provided for educational purposes, and does not constitute investment advice.

Trading Risk Disclaimer: There is a very high degree of risk involved in trading securities. Trading in any type of financial product including forex, CFDs, stocks, and cryptocurrencies.

This risk is higher with Cryptocurrencies due to markets being decentralized and non-regulated. You should be aware that you may lose a significant portion of your portfolio.

Securities.io is not a registered broker, analyst, or investment advisor.