Ripple CEO Brad Garlinghouse is calling out the U.S. Securities and Exchange Commission (SEC), saying that the regulator has essentially weaponized a lack of regulatory clarity in crypto markets against the industry’s firms.
In a video statement posted on Twitter, Garlinghouse comments on the recent reveal of internal emails relating to a 2018 speech delivered by former SEC official William Hinman when he stated in his official capacity that he believed both Bitcoin (BTC) and Ethereum (ETH) are not securities.
Garlinghouse says the emails show that either SEC officials can’t agree on how to determine whether a crypto asset is a security, and thus the regulator’s lawsuit against Ripple lacks legitimacy, or that Hinman deliberately ignored the law.
“Hinman’s speech created new factors to determine if a token becomes sufficiently decentralized to no longer be considered a security. At best, these documents show that senior officials at the SEC couldn’t agree on the law, and told Bill Hinman directly he would confuse the public even more about the rules for crypto.Â
At worst, they show that Hinman deliberately ignored the law, and he tried to create new laws, something only Congress can do, and while he was a public servant, Hinman received millions of dollars of payments from his law firm, which was part of an alliance with others that had vested interests in this speech.Â
This speech isn’t about any one token or any one blockchain, this is about showing the extent to which the SEC has relentlessly pursued enforcement actions against crypto players while professing open arms and calls to ‘come in and register’ all the while lying about their so-called guidance.”
In late 2020, the SEC sued Ripple on the grounds of allegedly selling XRP as an unregistered security. Garlinghouse recently said that he expected the lawsuit to conclude sooner rather than later.
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