- The crypto community disagreed with Gary Gensler’s remarks that the SEC only goes after dishonest businesses.
- Ripple CLO Stuart Alderoty disputed Gensler’s claims, stating Ripple was sued but not charged with dishonesty.
- Alderoty accused Gensler of being prejudiced against crypto and filing suits without investigations.
At a recent event, the U.S. Securities and Exchange Commission chairman Gary Gensler said, “We [regulators] are partners of honest business and prosecutors of dishonesty.”
However, his statements did not receive applause – at least not in the crypto community – as founders and executives called out the falsehood in his remarks.
Notably, Ripple Labs Chief Legal Officer Stuart Alderoty was among the first to react to Gensler’s remarks. According to Alderoty, “Ripple was sued, but never charged with ‘dishonesty,’” discounting Gensler’s claims that the SEC only goes after dishonest businesses.
Furthermore, he stated that the case against Ripple was prejudiced right from when it was initiated under former SEC chair Bill Hinman. With his term yet to end, Alderoty said Gensler has also prejudiced crypto and filed suits without investigations.
The SEC’s case against Ripple, which started over three years ago, centered on accusations of securities law violations. In July, Ripple secured a partial victory against the regulator after the court ruled that only institutional XRP sales were securities.
As reported earlier, Ripple was never charged with dishonesty, nor were there monetary damages suffered by its customers, further invalidating Gensler’s remarks. The case is expected to come to a close next year.
But to Ripple, the damage has been done, stemming from the first lawsuit that started years back. The company said it lost partnerships and missed out on factors that could have driven its growth and adoption.
Nevertheless, Ripple’s case is not isolated. This year, the SEC has doubled down on its crypto regulations. So far, major crypto companies like Coinbase and Binance have also faced actions from the regulator. Along the same lines, the regulator has equally been restrictive on spot Bitcoin-ETF applications. But recent reports suggest the regulator may have softened in its approach. The optimistic prediction sent crypto prices high, with Bitcoin breaching the $37,000 level. However, speculations say the earliest spot ETF approval could come in January 2024.
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