In a recent video posted on Twitter, Brad Garlinghouse, CEO of Ripple, expressed his opinion that the United States Securities and Exchange Commission (SEC) acted in “bad faith” during the ongoing legal battle between Ripple and the regulatory agency. As the case nears conclusion, Garlinghouse emphasized that this is only the beginning of a larger fight for regulatory clarity in the cryptocurrency industry.
The Hinman Documents Unsealed
On June 13, as part of the lawsuit proceedings, the Hinman Documents were unsealed, shedding light on the SEC’s internal discussions and decision-making process. In response to these documents, Garlinghouse released a video on June 17, discussing the timeline of the lawsuit and expressing his frustration with the agency.
Allegations of Confusion Creation
Garlinghouse strongly criticized the SEC’s actions, accusing them of knowingly creating confusion about regulatory rules and leveraging that confusion through enforcement. He labeled the SEC’s behavior as a clear example of acting in “bad faith, plain and simple.” According to Garlinghouse, this attitude has been present since the beginning of the lawsuit, which was filed in December 2020, just days before Christmas, giving it a “grinch-like touch.”
Putting Politics over People
The Ripple CEO condemned the SEC’s prioritization of politics over people and accused them of pursuing power instead of sound policy. He stated that prior to the lawsuit, he had answered all the SEC’s questions, and it was never suggested that XRP, the cryptocurrency associated with Ripple, was considered a security.
The SEC’s Intentions
Garlinghouse alleged that the SEC is seeking to stifle innovation and the cryptocurrency industry as a whole in the United States. He argued that the significance of the Hinman speech, which is at the center of the lawsuit, extends beyond any specific token or blockchain. According to him, it represents the SEC’s overall stance toward the crypto industry.
Allegations of Misleading Guidance
The Ripple CEO accused the SEC of relentlessly enforcing actions against crypto players while simultaneously presenting a facade of openness and encouragement to register. He criticized the agency for providing misleading guidance and stated that the recently unsealed documents, at best, suggest that senior SEC officials couldn’t agree on the law. At worst, Garlinghouse claimed the documents show that Bill Hinman, the former director of the SEC’s Division of Corporation Finance, deliberately ignored the law and attempted to create new laws.
Call for Industry Unity
Garlinghouse emphasized the need for the crypto industry to work together, as he believes the SEC could take action against more cryptocurrency firms in the future. He stated that while Ripple’s lawsuit is coming to a close, for many others, the fight for regulatory clarity is just beginning. He urged the industry to continue striving for clear guidelines and regulations.
SEC’s Recent Actions Against Binance and Coinbase
This statement from Brad Garlinghouse comes shortly after the SEC filed a lawsuit against Binance, a major cryptocurrency exchange, on June 5 for allegedly offering unregistered securities. The following day, the regulatory agency also took action against Coinbase, another prominent cryptocurrency exchange, on similar grounds.
Given the regulatory actions taken by the SEC against Binance and Coinbase, investors in the cryptocurrency space are increasingly recognizing the need for a thorough understanding of regulatory compliance. Platforms like Bitcoin Formula and Bitcoin Buyer offer a wide range of educational resources and tools to help investors stay informed about regulatory developments and make well-informed investment decisions.
