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An XRP supply shock could happen if Ripple decides to settle the lawsuit against the …

A crypto legal expert predicts that Ripple’s native XRP token could face a supply shock if the San Francisco-based company settles its lawsuit with the United States Securities and Exchange Commission (SEC).

In a new video, lawyer and XRP supporter Jeremy Hogan discusses a scenario in which Ripple is able to settle its legal battle with the SEC and how this turn of events could impact XRP.

“I think a settlement deal would likely include Ripple paying a penalty, but a penalty specifically limited to pre-trial dates. A settlement would likely not include restitution of profits to buyers due to the inability to determine how to distribute the funds. A regulation could also very well contain a term that includes limitations on sales of XRP released from escrow. ”

Hogan also postulates that a settlement would likely include an agreement that would limit the sale of XRP to private sales for businesses and customers, thereby reducing the supply of XRP in the market.

“This would indeed limit or slow down the flow of XRP into the market. Sales to Section D or to corporate buyers then cannot go public for six months, possibly up to a year. A regulation containing this term would essentially hamper the flow of XRP in the market for years to come. “

The attorney notes that if Ripple reaches a settlement with the SEC, it would make it the first crypto company to be fully approved by regulators.

“The settlement would clear up XRP with respect to securities and other violations. Ripple is said to be the first crypto company to be 100% clear to the SEC. “

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