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  • Lilly Mackani

SEC Investigates Federal Reserve for Market Manipulation in Crypto Space (BTC, XRP, XLM)

In a groundbreaking move, SEC Chair Gary Gensler has announced that the Securities and Exchange Commission (SEC) will formally investigate the Federal Reserve for allegedly manipulating equity and cryptocurrency markets, specifically focusing on Bitcoin (BTC), Ripple (XRP), and Stellar (XLM). Gensler commented, “Every couple of weeks when I check Zerohedge headlines, I see an article about Powell manipulating markets. It would seem that he is engaging in classic market manipulation by influencing securities pricing with his announcements regarding monetary policy.”

Market manipulation by central banks is not unheard of, but this marks the first time a central bank has come under scrutiny from a regulatory agency for such activities. The investigation signals a potential shift in how central bank actions are monitored and regulated. While formal charges from the SEC remain unlikely, the pressure from this investigation might prompt changes in Federal Reserve policies.

One anticipated change could be maintaining low-interest rates, especially with the upcoming election season. If President Biden is re-elected, there is speculation that he might appoint a new Federal Reserve Chair to align with his economic policies, which could include further stimulating the economy through aggressive monetary measures.

Sources familiar with Gary Gensler's recent activities suggest he has been influenced by Ron Paul's staunch advocacy for auditing and dismantling the Federal Reserve. However, rather than fully embracing Paul’s vision of a free and open market, Gensler seems to be leveraging these views to bolster his political ambitions. This investigation could be seen as an attempt to position himself as a reformer within the financial regulatory landscape.

The investigation has elicited a mixed response from the cryptocurrency community. The XRP Army, a dedicated group of Ripple supporters, speculates that the scrutiny of the Federal Reserve might lead to the adoption of XRP for cross-border payments. One member stated, “If the SEC is going after the Federal Reserve like they did Ripple, the Fed will know how we all felt. The SEC’s investigation is stupid, and we hope they win their case so they can begin using XRP and pump my bags.”

Analyst Tom Luongo has suggested that the investigation might indicate internal conflicts within the fiat currency system, with different factions vying for control. This could pave the way for the introduction of a genuine Central Bank Digital Currency (CBDC), surpassing the current FedNow service, which has been described as a "CBDC lite."

Amidst these developments, DeFi Payments (DPay), the pioneering banking token on the XRP Ledger, has made significant strides. Launched less than 12 hours ago, DPay Token has already ranked among the top 10 tokens on the XRP Ledger. The XRP Ledger itself is projected to transact between $30 to $50 trillion by 2025, significantly driven by innovations like the first-ever XRPL Credit Card.

DPay aims to process $1 trillion in transactions by 2025 through its groundbreaking XRPL Credit Card. This ambitious goal underscores the potential for decentralized finance (DeFi) solutions to revolutionize traditional financial systems and enhance the utility of blockchain technology in everyday transactions.

The SEC’s investigation into the Federal Reserve represents a historic moment in financial regulation, challenging the traditional operations of one of the world’s most influential central banks. While the immediate outcomes of this investigation remain uncertain, the ripple effects (no pun intended) could profoundly impact monetary policy, the future of cryptocurrency regulation, and the broader financial ecosystem. As the situation unfolds, all eyes will be on how these developments shape the future of both fiat and digital currencies.



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