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If the U.S. Securities and Exchange Commission (SEC) is successful in its case against Ripple over xrp, the CEO of Ripple Labs has warned of the consequences to the cryptocurrency sector. He issued a warning, saying that the SEC’s focus on enforcement in its regulation of cryptocurrency “is not a healthy way to oversee a business.”
CEO of Ripple on SEC Complaint and US Crypto Regulation
In an interview on Thursday, Ripple CEO Brad Garlinghouse forewarned of negative repercussions for the cryptocurrency sector if the U.S. Securities and Exchange Commission (SEC) prevails in its legal action against him and his business over the selling of XRP.
The SEC’s lawsuit against Ripple was truly about the industry as a whole, not just Ripple or XRP, according to Garlinghouse. The CEO of Ripple emphasized that this will be a turning point for the entire sector, claiming that the SEC is “playing offense and assaulting” the entire crypto business.
He added a warning that future enforcement actions would be taken against cryptocurrency firms “if the SEC is able to triumph” in its legal battle over XRP.
The securities regulator recently initiated action against Paxos and Kraken for issuing the stablecoin Binance USD and the cryptocurrency exchange’s staking program, respectively (BUSD). Also, according to SEC Chairman Gary Gensler, all cryptocurrency tokens other than bitcoin (BTC) are securities.
Garlinghouse stated:
The macro headline for me is this is not a healthy way to manage a business.
He cited the SEC’s enforcement-centric approach to regulating the crypto market.
The Ripple CEO continued by describing how the SEC’s emphasis on enforcement is different from other countries’ regulatory strategies with relation to cryptocurrencies. Garlinghouse added:
We observe that in other nations, the work is being done correctly. They are formalizing. They’re developing a structure that permits an industry to expand while safeguarding customers. I believe that’s where the U.S. is falling short.
The U.S. is already behind, Garlinghouse stressed, noting that many cryptocurrency enterprises have already relocated abroad. “This is not a secret from nations that we may not have heard of. This places it behind Switzerland, the United Kingdom, Japan, Australia, and the United States. Many nations have taken the time and care to establish these precise traffic regulations.”
Garlinghouse recalled that “some were suggesting the internet should be banned” when he first entered the computer sector in the late 1990s. The US administration responded: “No, no, no, we are going to develop a framework. They were saying how the internet is being exploited for illegal purposes. And it made it possible for businesspeople and investors to enter the market and assess the advantages for the United States from a geopolitical standpoint.”
.@KaileyLeinz asked “If the US doesn’t get its act together…is all of this [crypto] going offshore?”
Me: “It already is.”
I’ve said it before, and I’ll say it again – crypto moving offshore is not good for American innovation. Period, full stop. https://t.co/OWz8uoRHrI
— Brad Garlinghouse (@bgarlinghouse) March 2, 2023
The Ripple CEO issued a dire warning, noting that the United States runs the risk of missing out on the “next development of technology surrounding blockchain and crypto”:
The consumers are suffering… because you don’t have the same protections that the U.S. regulatory system can offer.
On the subject of the XRP litigation, the CEO of Ripple earlier voiced optimism.
In December 2020, the securities regulator filed a lawsuit against him and his business, claiming that the sale of XRP was an unregistered securities offering. Garlinghouse has insisted that XRP is not a security and has predicted that the dispute will be resolved this year, maybe in the first half.
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- Where and How to Buy XRP – Invest with Low Fees Today
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