Ripple CEO Brad Garlinghouse has criticized the Securities and Exchange Commission (SEC) for its crackdown on the cryptocurrency industry, claiming that the agency has overstepped its legal boundaries. In a tweet, Garlinghouse stated that the mess the crypto industry finds itself in is a result of the SEC claiming authority over cryptocurrencies without proper jurisdiction. He emphasized that this overreach has left consumers in a dire situation, struggling with bankruptcy while the agency focuses on conferences rather than protecting investors.
Garlinghouse further criticized the blame placed on a US judge for ruling that XRP is not a security. He argued, “It’s absurd to blame a Judge for faithfully applying the law,” implying that the responsibility lies with the SEC’s flawed regulatory stance. According to Garlinghouse, clear legislative rules are essential to effectively safeguard retail investors, rather than relying solely on enforcement-driven regulation.
The Ripple CEO commended Congress members Ritchie Torres and Patrick McHenry for their efforts in advocating legislative measures to protect the crypto space. He believes that legislative clarity is crucial to provide a safe and secure environment for investors to participate in the cryptocurrency market.
Stuart Alderoty, Ripple’s Chief Legal Officer, also weighed in on the matter, emphasizing that the SEC’s jurisdiction is limited to securities. Attempting to exercise authority over non-securities, Alderoty argues, is merely a political power play that ultimately harms everyone involved. He called for a more balanced approach that encourages innovation and growth in the crypto industry.
John E. Deaton, Founder of Crypto-Law.us, defended Judge Torres in the recent ruling on XRP’s alleged security status, stating that she was applying a test from 1946 to evaluate today’s blockchain technology. Deaton highlighted the outdated nature of current securities regulations when applied to the innovative technology landscape. He firmly placed the blame on the SEC for the situation at hand.
Observers within the crypto community have also highlighted the fundamental disparity between cryptocurrencies and traditional securities and banking regulations. They stress the importance of encouraging innovation through legislative changes and regulatory sandboxes rather than stifling growth with outdated approaches. By providing a clear legal framework, the industry can flourish while protecting investors.
Overall, the criticism directed at the SEC by Ripple’s CEO and other industry insiders highlights the need for legislative clarity and a balanced regulatory approach within the cryptocurrency space. By addressing these concerns and adopting modern regulations that embrace innovation, the industry can thrive while effectively protecting investors.