Ripple CEO Brad Garlinghouse Lashes Out at SEC

Updated: 24 July 2023

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Ripple CEO Brad Garlinghouse criticized the Securities and Exchange Commission after the regulator indicated it may appeal the company’s recent landmark legal victory against it.

Amid recent indications that Ripple is preparing for another round of regulatory challenges, the ruling by Federal District Judge Anissa Torres affirming that Ripple won’t be classified as a security when sold to retail investors has significantly boosted Ripple’s value, propelling it to become the fourth largest cryptocurrency by market capitalization.

SEC lawyers in the ongoing case against Terraform’s labs have raised concerns about the court’s past decisions on the legal definition of security, arguing that the court should not follow those precedents.

SEC staff is actively exploring additional avenues for further reviewing the case.

SEC is Not a Cop on the Crypto Beat – Ripple CEO

Brad Garlinghouse expressed frustration with the SEC’s dogmatic approach to crypto regulations, criticizing the agency for creating confusion by positioning itself as the “cop on a crypto beat” in a tweet.

The speaker questioned the SEC’s approach, highlighting their emphasis on criticizing crypto without offering solutions, which has resulted in consumers being left vulnerable in bankruptcy cases.

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

Garlinghouse defended the judge, asserting it is “absurd” to blame them for applying the law faithfully, as the law explicitly forbids further regulations through enforcement.

In a tweet, he emphasized that clear rules are necessary to safeguard retail investors. He expressed gratitude to Representative Richie Torres and Patrick McHenry for advocating non-enforcement-based regulations in the crypto space.

During the art + tech summit at Christie’s Auctionhouse, Ritchie Torres likened Gary Gensler, the SEC Chief, to an “overzealous traffic cop” who unfairly penalizes drivers for speeding without informing them of the speed limit. The New York Congressman also accused Gensler of adopting a “regulation by enforcement” strategy.

Disappointed with Federal District’s Judge’s Decision – Gensler

Gary Gensler expressed disappointment with the court’s decision that Ripple won’t be considered securities when sold to retail investors, following Federal District Judge Analissa Torre’s ruling.

“We are currently assessing the options,” he said, hinting at the potential for the SEC to challenge the ruling earlier.

The individual expressed satisfaction that XRP will retain its security classification for institutional investments.

During the speech, when asked about favoring enforcement over rulemaking, he confirmed that it is their preferred approach, stating that enforcement actions have been their means of expressing concerns since the 1960s, particularly regarding insider trading matters.

Ripple Experiences 5% Drop

Ripple is trading at around at $0.69 at 8:15am EST, experiencing a 5.92% correction in the last 24 hours. The market capitalization has decreased by 5.82% to $36.6 billion, accompanied by a 6% drop in trading volume.

Despite a recent daily drop, Ripple has surged 46% since mid-July, now securing the 6th position in market capitalization.

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