Institutional crypto fund manager Grayscale Investments began disbanding its XRP Trust in response to the December SEC lawsuit alleging the XRP token is security under U.S. law.
According to an announcement on Jan. 13, Grayscale decided to dissolve the trust in response to the wave of XRP write-offs from major crypto asset exchanges after the SEC filing of the complaint. Grayscale concluded:
“It will likely be increasingly difficult for US investors, including the Trust, to convert XRP to US dollars and, therefore, to continue the operations of the Trust.
All XRP held by the trust have already been liquidated, with Grayscale intending to distribute the net proceeds in cash to XRP Trust shareholders after deducting expenses. The Trust will be dissolved following the distribution of these cash.
Despite the SEC’s tough stance on XRP, regulators in other countries are not convinced the token includes any security.
A January report on cryptocurrency regulation released by the UK Treasury classified XRP as an “unregulated token” alongside major digital assets BTC and Ether, with the Treasury describing unregulated tokens as “neither tokens of electronic money or security tokens ”.
The report primarily described XRP as an “exchange token” – a token “primarily used as a medium of exchange”.
On January 13, Japan’s financial services agency told The Block that it classifies XRP as a cryptocurrency, not a security.
XRP is currently trading for $ 0.31 and is down 40% in the last 30 days.