During the last 24 hours, Ripple (XRP) has been performing the worst among the cryptocurrencies. It has lost almost 8.5% and is priced at just 82.6 US cents. This major downfall has reduced its market capitalization to just under $32.4 billion. And to top that, the news of class-action lawsuit on the company behind the cryptocurrency has been floating around. The repercussions of this news are seen in the current market drop.
The lawsuit alleges that Ripple Labs have led a scheme to earn millions by selling unregistered XRP tokens. The lawsuit is filed by a resident of San Francisco, Ryan Coffey, along with 10 other individuals. The lawsuit filed by them says that Ripple Labs have been engaged in illegal schemes that violate state and federal securities law.
He said that during its inception in 2013, Ripple Labs created 100 billion tokens of cryptocurrency which were handed to the company itself. Now they are quietly selling off the cryptocurrency and developing an artificial demand while increasing the prices of XRP.
All the price fall has been seen on the basis of the lawyer’s tweet. The Ripple Labs spokesperson said that the company has not been served any lawsuit. But the price fall just on the basis of a tweet has got the traders thinking what will happen to the cryptocurrency if the company loses the lawsuit.
In fact, a domino effect has been seen in the entire cryptocurrency market because of this alleged lawsuit. The start of the week saw a major decline where the value of the market dropped to the US $436.