Coin Edition -
- David Schwartz clarifies why Ripple used trading bots for its XRP sales.
- He claimed it avoids direct involvement in the market, reducing compliance risk.
- The response has failed to appease the XRP Army as the debate persists.
In a recent exchange on X, David Schwartz, Ripple’s Chief Technology Officer, explained the rationale behind the company’s utilization of trading bots from GSR for its XRP sales program. This revelation emerges amid heightened scrutiny sparked by documents from the Ripple vs. SEC lawsuit, which shed light on Ripple’s programmatic sales practices.
In particular, the spotlight fell on an email exchange between market maker GSR and Ripple’s team. It revealed a decision to halt XRP sales through GSR’s trading bots to “let XRP breathe.”
Members of the XRP community highlighted that shortly after halting the bot sales, XRP surged significantly to its all-time high. This has fueled speculation that the preceding sales had suppressed the asset’s price.
Amid the uproar from community members, Ripple’s CTO actively engaged, seeking to offer clarifications where feasible. One of the aspects he attempted to clarify concerned Ripple’s choice to employ GSR for the programmatic sales.
Schwartz noted that he lacked privileged insight into the GSR email discourse. Despite this limitation, he speculated that Ripple’s choice to delegate sales to external entities was a strategic move to mitigate insider trading and price manipulation accusations.
By entrusting entities like GSR with sales, Schwartz believes Ripple aimed to ensure compliance and avoid direct involvement in the market, thereby reducing the risk of regulatory repercussions.
I have no particular inside knowledge about that GSR email, but I'll tell you what I make of it and the other information surrounding it. I think Ripple employed companies to sell XRP for it rather than selling it themselves to provide a "Chinese wall" to protect against…— David "JoelKatz" Schwartz (@JoelKatz) February 20, 2024
Moreover, Schwartz underscored that the absence of specific allegations of price manipulation in the SEC charges against Ripple further corroborated the legitimacy of their sales practices.
Also, he emphasized the meticulous scrutiny by government agencies in cases of regulatory violations, indicating that any indications of malpractice would have likely been included in the charges brought against Ripple.
However, the response from the Ripple CTO has failed to appease members of the XRP community. The debate persists, with further scrutiny of Ripple’s broader endeavors to bolster XRP’s price.
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