Ripple CEO Brad Garlinghouse said the U.S. Securities and Exchange Commission (SEC) ignored a court ruling that determined XRP was not a security, which the regulator still maintains. denounced. He made this comment in response to the agency’s position in the Bitnomial case, in which a crypto derivatives exchange filed a lawsuit against the SEC over the classification of XRP futures.
Ripple CEO slams US SEC over XRP security claims
Brad Garlinghouse expressed his anger at the US SEC’s actions in a post on X (formerly Twitter), pointing out that the SEC doesn’t seem to care that XRP is not a security, according to the court’s decision. He said the agency’s actions showed it believed it could act above the law and questioned the regulator’s responsibility.
Ripple’s chief legal officer, Stuart Alderroti, also commented on Ripple’s position in the Bitnomial case, saying he cannot help but question the legitimacy of regulators simply ignoring the court’s decision. Ta. Alderoti said the US SEC has taken aggressive, unconstitutional steps in this case, further undermining the agency’s credibility.
He cited rather alarming situations in which regulators who have lost in court have apparently ignored court orders and ordered compliance through the threat of enforcement.
Bitnomial lawsuit challenges US SEC’s XRP futures stance
Bitnomial’s lawsuit includes the US SEC’s argument that XRP futures are “securities futures” and are subject to more rules than those set by the Commodity Futures Trading Commission (CFTC).
Bitnomial, a crypto derivatives exchange, declared that XRP futures are under the sole jurisdiction of the CFTC, as XRP is not registered as a security. Bitnomial argued in a complaint filed in the U.S. District Court for the Northern District of Illinois that the SEC’s requirement to register as a national securities exchange is an undue regulatory burden.
The exchange agreed with Ripple’s CEO and also pointed out that the SEC’s position in the case, in which the court ruled that XRP itself is not a security, directly contradicts the court’s decision. Bitnomial’s challenge is the latest in a long-running feud between the Bitnomial agency and the crypto industry over the agency’s approach to regulating digital assets.
Concerns about overregulation
The Bitnomial case is the latest development in the U.S. Securities and Exchange Commission’s ongoing efforts to regulate cryptocurrencies. Despite losing the legal battle with Ripple, the company continues to maintain that XRP is a security, drawing widespread criticism from the crypto community.
Echoing Ripple’s CEO, pro-XRP lawyer Bill Morgan and other legal experts accused the SEC of overstepping its authority and ignoring precedent.
fought @GaryGensler‘s @SECGov On behalf of 75,000 XRP token holders, including 627 here in Massachusetts. I did everything pro bono and spent $75,000 of my own money to litigate the case. Every time I believed that the SEC couldn’t degrade itself any further, SEC lawyers proved me wrong. Ah… https://t.co/NThDe7whb1 pic.twitter.com/TwbNlLM4ow
— John E. Deaton (@JohnEDeaton1) October 11, 2024
John Deaton, Ripple’s CEO who also represented XRP holders in the Ripple case, also criticized the US Securities and Exchange Commission’s actions. It said the agency had been found to act “arbitrarily and capriciously” in its enforcement, which is a strict legal standard to meet. Deaton also cited a recent case involving crypto company Digital Licensing (DebtBox), which was sanctioned by the SEC for misconduct, further raising concerns about the agency’s regulatory practices.
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Kelvin Munene Murithi
Kelvin is a renowned author with expertise in cryptocurrencies and finance, and holds a bachelor’s degree in actuarial science. Known for his sharp analysis and insightful content, he has a strong command of the English language and excels at conducting thorough research and providing timely updates on the cryptocurrency market.
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