Bradley Sostack, an XRP investor filed a class-action suit against Ripple. Sostack alleges that the firm is violating federal law as it is selling XRP under a false remark of an unregistered security. The classic suit filing is done at the US district court in California.
The original class-action suit came a year before but failed to gain traction. Although, Ripple intends to take action soon within the next month. The complaint underlines the US Securities and Exchange Commission guidance regarding XRP security.
All the XRP selling tokens carry all necessary security hallmarks according to law. Additionally, it also passes as security. However, every digital asset during its sales takes the Howey test based on some facts and figures. The specific facts of XRP also define it as security under the Howey test.
Recently, the US SEC filed a complaint at the US District Court against a New York-based man and his two companies, the New York company Veritaseum Inc. and the Delaware-based company Veritaseum LLC. The Exchange Commission alleges these companies have been illegally running an ICO from 2017 to 2018. Also, they have made material misrepresentations and omissions to investors. The Ethereum blockchain issued these tokens and pegged it to Ether at a 30:1 ratio.