Ripple CEO Brad Garlinghouse Highlights Need for Clear Crypto Policies, Citing Mismatch Between SEC Chair Gary Gensler's Remarks and Agency's Actions

Ripple has been in and out of the doghouse multiple times due to the SEC's breakdown on crypto, but it has always come back stronger.

Ripple has faced multiple regulatory challenges due to the SEC's varying approach to crypto regulation. Despite these hurdles, the company has managed to maintain its resilience.

Now, in a surprising turn of events, the SEC has announced its intention to amend its lawsuit against Binance. This move could potentially provide temporary relief to the crypto assets that were initially targeted by the SEC in its broad-ranging lawsuit. However, the regulatory landscape remains murky, with Binance assets having faced intensive scrutiny and even delisting from trading platforms due to the SEC’s actions.

In response to this development, Ripple CEO Brad Garlinghouse took to Twitter to voice his criticism. “More evidence of SEC hypocrisy,” Garlinghouse tweeted. “Chair Gensler testifies the rules are clear, yet his SEC can't figure them out and applies them haphazardly, festering more industry confusion. A political agenda and/or bad faith litigation tactics. Def(sic) not a ‘faithful allegiance to the law.'”

Ripple's supporter and lawyer, Jonh Deaton, also weighed in on the matter, adding further context. “This is further evidence that @GaryGensler should resign immediately,” Deaton tweeted. “In the @Ripple case, I was forced to sue the @SECGov and file a Motion to Intervene in order to protect retail investors. In that case, I argued Gensler and the SEC were violating 76 years of established case law.”

Deaton's statement highlights the legal challenges faced by Ripple and the broader crypto industry as a result of the SEC's shifting approach to crypto regulation. Ripple is currently engaged in a legal battle with the SEC over allegations that the company raised $1.3 billion through the sale of XRP, which the SEC claims is an unregistered security.

However, Judge Analisa Torres ruled partially in Ripple's favor last year, concluding that some XRP sales were not subject to securities laws. Specifically, the court found that XRP sales to individuals who later resold the tokens at a profit were not securities transactions.

On the other hand, other sales to institutional investors were classified as securities transactions, aligning with the SEC's position. The court's distinction was based on the varying levels of involvement by Ripple in the subsequent resales.

This granular approach to defining securities in the context of XRP sales could have broader implications for the crypto industry, especially considering the SEC's ongoing efforts to clamp down on digital asset offerings.

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