Ripple CEO: SEC Created a Mess Proclaiming Itself Crypto Regulator

Ripple CEO Brad Garlinghouse criticizes SEC crypto jurisdiction.
Ripple’s CLO stated that a securities agency’s jurisdiction only extends to securities.
Pro-XRP lawyer John Deaton defends Judge Torres’s ruling.

Ripple CEO Brad Garlinghouse took to Twitter to discuss the issue of protecting retail investors in the crypto space. He criticized the SEC’s claim of being the watchdog for the industry without having the legal jurisdiction for it.

“The SEC created this mess by proclaiming it was the cop on the crypto beat when it had no legal jurisdiction,” Garlinghouse remarked. “Where’s that gotten us?” he added.

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 emphasized the need for legislation to establish clear rules and safeguard retail investors. He expressed concern over consumers’ vulnerability in bankruptcy court while the SEC focused on press conferences. Furthermore, Garlinghouse stated that the US regulator blaming the judge for applying the law on the recent XRP win was unjust, and he believes that relying on legislation rather than enforcement is the way forward for providing clarity and protection to retail investors.

Ripple’s Chief Legal Officer, Stuart Alderoty, supported Garlinghouse’s stance, stating that a securities agency’s jurisdiction only extends to securities and pretending otherwise is merely a political maneuver that benefits no one and harms everyone involved.

A securities agency only has jurisdiction over securities. No security, no role for the SEC.
Pretending to have jurisdiction when there is none, is simply a political power play. It helps no one; it hurts everyone. https://t.co/OhNSaDuJ26
— Stuart Alderoty (@s_alderoty) July 22, 2023

Additionally, pro-XRP lawyer John Deaton defended Judge Torres’s actions, asserting that she appropriately applied an outdated test from 1946 to modern-day blockchain technology. Deaton argued that the SEC is responsible for the current situation, as its approach does not align with the fast-paced nature of the tech industry.

Judge Torres did exactly her job and applied a 1946 test to modern day blockchain technology. Some people don’t like the result and call it perverse or backwards. Maybe that’s what happens when applying a 76 year old test to modern day tech. AI next? This is the SEC’s doing. https://t.co/mk5096jO4f
— John E Deaton (@JohnEDeaton1) July 22, 2023

Notably, the US court recently declared that XRP is not a security as the SEC had claimed. The US regulator had expressed displeasure in the ruling with potential appeal insight.

Ultimately, the dispute over the SEC’s jurisdiction highlights the need for clear legislative frameworks in the rapidly evolving crypto sector. Interestingly, two top US politicians have proposed the long-awaited crypto bill.

Source: https://coinedition.com/ripple-ceo-sec-created-a-mess-proclaiming-itself-crypto-regulator/