- The ongoing case between the SEC and Ripple continues to take new twists as Ripple wants an ex-SEC director to testify, to the surprise of many.
- Crypto users have turned on the SEC, backing Ripple as new developments intensify.
- No clear winner has emerged yet between the parties, with damaging results on both sides, in what many describe as a suit which “could have been avoided.”
- Crypto enthusiasts have urged the SEC to focus on approving the Bitcoin ETF, rather than making a “fool of themselves” in the Ripple case.
SEC vs. Ripple
The Security and Exchange Commission instigated a suit against blockchain payment solution Ripple Labs and two senior executives of the company, Bradley Garlinghouse, the CEO of Ripple, and Christian Larsen, the executive chairman of the board, over XRP.
The lawsuit around a $1.3 billion unregistered security soon became a topic of controversy, with many backing Ripple in the view that, just like Bitcoin and Ethereum, XRP is a currency, and not a security.
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The SEC, insisting on its case, due to the centralized nature of Ripple Labs, has made many believe it is now biased against the company and has lent itself to criticism.
The SEC’s Bad Touch
The Security and Exchange Commission was not prepared to take on Ripple as cryptocurrencies represent a new area they may not have fully grasped yet. Many believed that Gary Gensler becoming the new boss of the SEC would ensure a “diplomatic settlement.”
This was far from the case though as the SEC’s embarrassment has intensified, with Ripple gaining small victories in the matter. Many believe that the SEC has been too hard on Ripple and has no foothold in cryptocurrencies.
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The timing of the Ripple Case appears quite suspicious as it began on the final day of the former chairman’s term, while XRP had already been in distribution for a long time prior.
The SEC accepted Ripple’s $30 million investment in MoneyGram, aimed to extend money transfers on the blockchain back in 2019, and didn’t include XRP in cases brought against it in 2017.
The case against Ripple has exposed the SEC to more embarrassment with Ripple pushing for the court to call Willian Hinman, the ex-director of the SEC, to testify on XRP.
It’s Time for the Bitcoin ETF
Crypto enthusiasts are still waiting for the SEC to approve the first Bitcoin ETF in the US.
Users have submitted claims that the SEC is too focused on Ripple, and the saga is hindering the ETF due to the SEC’s reluctance to make such a bold step amid regulatory concerns.
SEC Commissioner Hester Pierce has stated, to the delight of many, that he wants the Bitcoin ETF to be approved and that it is already long overdue. “People should make their own decisions, whether or not to buy bitcoin” he explained.
The sector is hopeful that the Bitcoin ETF will be approved with Gary Gensler, a lecturer of blockchain technology at the Massachusetts Institute of Technology, now at the head of the commission.
On the Flipside
- Crypto scams are on the rise with over $80 million lost since October last year, so the SEC’s role is necessary.
- The SEC’s case with Ripple has made other blockchain solutions more tentative as “big brother” is watching their activities, which has given investors peace of mind.
The Impact of the Tussle and the Way Forward
The impact of the lawsuit against Ripple is wide-reaching. Apart from the embarrassment it has caused the SEC, it has also badly affected Ripple.
Ripple had earlier announced that it will go public immediately after its legal battle with the SEC but as the case drags on, it looks like the asset may have to wait longer before going public.
The case has also negatively affected the price of XRP and hindered its growth in the market. Crypto enthusiasts are hopeful for a potential settlement in the future with the case affecting both parties negatively.
