Ripple CEO Brad Garlinghouse has slammed the United States securities regulator over recent comments from his lawyers that indicate a possible appeal in his case against Ripple.
In a July 23 tweet, Garlinghouse criticized the regulator for its “regulation by enforcement” approach, arguing that it only served to harm retail investors.
“The SEC created a mess by declaring it was the police on CryptoBeat, even though it had no legal jurisdiction,” Garlinghouse wrote in a July 23 tweet. “Where did he take us? Consumers walked into bankruptcy court holding the bag while the SEC was holding press conferences,” he said.
An important topic has come up regarding the security of retail. The SEC created a mess by announcing that it was the policeman on Cryptobeat even though it had no legal jurisdiction, where did that land us? Consumers walked into bankruptcy court holding the bag while the SEC was holding a press conference.
— Brad Garlinghouse (@bgarlinghouse) 22 July 2023
Garlinghouse’s criticism came in response to the SEC’s latest comments regarding Ripple, where the regulator had indicated plans to appeal against the split-decision ruling against Ripple Labs.
On July 21, the SEC used its ongoing case against TerraForm Labs founder Doo Kwon to allay its concerns with a ruling that retailing XRP (XRP) on exchanges does not constitute the legal definition of a security.
“Respectfully, those portions of Ripple were wrongly determined, and this Court should not follow them,” the SEC lawyers wrote, adding that these sales of XRP should have been considered securities.
“SEC staff is considering various available avenues for further review and would like to recommend that the SEC seeks such review,” he added.
Connected: Ripple applies for a crypto license in the United Kingdom
Speaking directly to the SEC’s comments, Garlinghouse said it was “absurd” to blame a judge for merely enforcing the law.
“We all know that legislation – not more regulation by enforcement – is the only way to provide clear rules and protect retail,” he added.
In his remarks, Stuart Alderotti, Chief Legal Officer at Ripple Labs, said that trying to explain that XRP is not a security is “like explaining to a flat Earther that the world is round.”
Talking to someone who still doesn’t understand that the token itself is not a security is like explaining to a flat Earther that the world is round.
— Stuart Alderoty (@s_alderoty) 22 July 2023
On July 17, SEC Chairman Gary Gensler also expressed his dismay at the court’s ruling on XRP’s securities status, adding that the regulator will continue to evaluate this opinion.
According to data from TradingView, Ripple Labs’ XRP is trading at $0.73 at the time of publication, up nearly 50% in the past month.
magazine: Crypto Regulation – Does SEC Chairman Gary Gensler Have the Final Decision?