Gooood Morning Rainmakers,
This newsletter is brought to you by Realio, a blockchain-enabled issuer, fund manager, and technology provider specializing in real estate private equity.
Before things get crazy, I have an important question for you…
Did you have your cup of joe yet? ☕️
If you didn't, don't worry, this thrilling newsletter will do just the trick
Enough brewing around, it’s time to…
Get liquid 🌊
The Unprecedented Battle for the Ages ⚔️
Some call it David vs. Goliath.
Others call it a done deal.
Personally, I call it unprecedented.
The Securities Exchange Commission (SEC) sued Ripple this past December on grounds of conducting unregistered distributions of their digital currency, XRP.
Let's get basic: XRP is a digital currency created by Ripple similar to Bitcoin and Ethereum but is used for real-time settlement for cross-border transactions. It’s supposed to alleviate the friction between parties when sending payments around the world.
Here's a great XRP overview.
For those of you who don't know, if the SEC's allegations are true, this is a BIG no no.
Just like how you wouldn't want to mess with the Zohan, you definitely don't want to mess with the SEC.
However, key members of Ripple, Larsen and Garlinghouse, have denied all allegations and are fighting back claiming XRP is not a security, but merely a digital currency.
“What the heck is the difference between a security and a currency?”
Per the SEC: “Investment of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others.”
Example: Apple Stock
Currencies are merely a medium of exchange for goods and services. In XRPs case, its claimed to be used for frictionless, cross-border payments.
Example: The US Dollar
Well, Rainmakers, I took a gander at the official SEC complaint, and I have to say, Garlinghouse and Larsen are not looking too clean…
In fact, I'd recommend having some hand sanitizer by your side to avoid feeling dirty while reading it.
Misleading messages about XRP to investors
Numerous unregistered distributions of XRP to sophisticated financial players to raise capital
Received a toal of ˜$1.4 billion in unregistered distributions of XRP
From a birds-eye view, it looks to me that Ripple is definitely in some grey area, which is a color you want to avoid at all costs.
and if this case couldn't get any juicier…
an ‘angry mob’ of thousands of XRP hodlers, led by John Deaton of Deaton Law Firm, who happens to be an XRP holder himself has filed a motion with the SEC to dismiss this case and deem XRP, not a security.
The irony is painful here.
One of the main objectives of the SEC is to protect the investor.
Since the SEC announced the allegations against Ripple, Deaton claims XRP holders have suffered over $15 billion in losses!
But fear no more XRP hodlers, your lord, and savior, ‘King’ John Deaton is here to save the day…
The funny thing is…
The definition of a security was established in 1946 and obviously did not take into consideration any digital currencies.
In the year 1946, we were celebrating the end of WWII, and infatuated by Marilyn Monroe 😍
This tells me we need a major revamp of what constitutes a security.
I'd predict the conclusion of this case will motivate lawmakers to create an updated version of the security definition - one that is more representative of modern times.
I'll be sure to keep you updated on this thrilling, unprecedented court case!
What else is making it rain ☔️
New Security Token on OpenFinance: Science Blockchain, SCI2 Security Token, goes live on OpenFinance.
1st Reg A+ Security Token: Exodus Receives First SEC-Approved Security Token Reg A+ offering - they look to raise $75 million from the retail crowd.
STM March 2021 Market Report: March saw the security token market cap rise by 22% and trading volume by 11%!
Fun fact of the week 🤯
The global real estate value is $317 trillion, but only $10 trillion is available to the public
This means that $307 trillion worth of real estate is controlled by the elite, but not for long 😎
Game of the Week 🎯
“Guess that landmark!”
It's located in Europe
It was built in 1889
6.91 million people ascended it in 2015
Click here to see if you were right!
Reply to this email with what you think the landmark is! If you are right, we will shout you out on our socials 💯
Connect with us ☎️
Thanks for tuning in! Keep an eye out each Monday for the next security token adventure 🧗♀️
For any questions, suggestions, etc - email me at Jonah@stomarket.com and follow me on Twitter!
Everything in this report is for informational and entertainment purposes only. Nothing in this report should be taken as financial advice or as an inducement to purchase or sell any security. Nothing in this market report should be used as legal advice. Always do your own research before making any decisions regarding financial transactions of securities.