Brad Garlinghouse, the CEO of Ripple, the creators of XRP, lambasted the United States Securities and Exchange Commission (SEC), citing the regulatory body has created a “mess” of the regulatory situation for the entire cryptocurrency ecosystem.
Ripple CEO Criticizes the SEC
On July 23, Garlinghouse took to Twitter to condemn the deplorable situation created by the SEC in the digital assets industry. He claimed the SEC along with Chair Gary Gensler’s regulation of crypto have continued to wreak havoc that has taken a toll on investors, traders, businesses, and the overall new asset class. The Ripple boss tweeted,
“The SEC created this mess by proclaiming it was the cop on the crypto beat when it had no legal jurisdiction Where’s that gotten us? Consumers left holding the bag in bankruptcy court while the SEC holds press conferences.”
An important topic has come up about protecting retail. The SEC created this mess by proclaiming it was the cop on the crypto beat when it had no legal jurisdiction Where’s that gotten us? Consumers left holding the bag in bankruptcy court while the SEC holds press conferences.
— Brad Garlinghouse (@bgarlinghouse) July 22, 2023
In addition, the Ripple executive wrote that it was “absurd” to blame a Judge for faithfully applying the law. Garlinghouse’s criticism of the SEC’s regulatory approach is not new. He has consistently voiced his frustrations regarding the Ripple case’s handling and its broader implications for the cryptocurrency landscape.
SEC Hints XRP Lawsuit Appeal
This comes after the federal regulator revealed it will appeal the recent ruling made by Judge Torres that XRP does not meet the criteria to be considered a security. The SEC hinted that it could present an appeal in its lawsuit against Ripple over the legality of XRP, noting that the judge hearing his case should not look to the Ripple decision for guidance.
It said the ruling by Judge Torres “adds baseless requirements” to the test used to determine if an asset is a security and that it will be “further reviewed.” The American watchdog’s remarks follow Gensler’s dissatisfaction with the court’s decision that XRP is not a security when sold to ordinary investors.
Pro XRP Lawyer Says Ripple Will Win Again
Responding to this, prominent crypto lawyer John Deaton, who represents over 75,000 XRP holders, said on July 23 that an SEC appeal will not necessarily change the outcome of the Ripple ruling. Deaton claimed that Ripple would potentially win in court a second time if the SEC moved forward with its appeal.
An appeal is not even close to be a setback. First, it will be two years from now before a decision is issued by the 2nd Circuit, if it’s appealed. The Torres Decision is the law until then – at least in the 2nd Circuit. Second, even if the 2nd Circuit said Torres was wrong… https://t.co/GzW31D9edQ
— John E Deaton (@JohnEDeaton1) July 22, 2023
The pro-XRP lawyer explained that even if the federal regulator filed an appeal, it would take around two years before a decision is issued by the court. In the meantime, the Ripple ruling delivered by Judge Torres will continue to be the governing law, at least within the 2nd Circuit. As per his analysis, even if the 2nd Circuit potentially disagreed with Judge Torres’ application of the third factor of the Howey Test, it does not guarantee a victory for the SEC.