Cardano founder Charles Hoskinson recently addressed rumours regarding Ethereum (ETH) allegedly bribing SEC concerning Ripple’s XRP token during an Ask-me-Anything (AMA) session. The discussion centred on drafts of William Hinman’s contentious speech on cryptocurrency and the ETHGate theory.
For context, the ETHGate theory suggests that Ethereum executives cultivated relationships with SEC officials to secure favourable regulations for the ETH token. When questioned about this theory, Hoskinson emphasised that the activities leading to Hinman’s speech primarily indicate favouritism rather than the widely suspected corruption.
Simultaneously, he recognised the document’s significance in the ongoing multi-year legal battle between Ripple Labs and the SEC, as the draft shed light on the regulator’s thought process.
Cardano Founder: Hinman Delivers Speech Despite SEC’s Cautions
In June, Ripple publicly released email correspondence revealing that William Hinman disregarded clear warnings and advice from top SEC officials not to deliver a speech. As the director of the SEC’s Corporation Finance unit, Hinman received numerous cautions against delivering the speech, as it needed to consider the factors outlined in the renowned Howey test adequately. Consequently, it was feared that the speech could introduce more confusion into the securities ecosystem.
Despite these warnings, Hinman delivered the Yahoo Finance All Markets Summit speech. In this speech, he mentioned that a digital asset would no longer be considered a security if it achieved a level of decentralisation. By setting this criterion, he indirectly classified tokens like Bitcoin (BTC) and Ethereum (ETH) as non-securities.
This statement sparked controversy, with suspicions that someone within Ethereum’s team may have influenced the Hinman speech. Adding to these suspicions was that the initial email from Hinman had “Ether Speech” as its title. Also, Hinman met with Ethereum co-founder Vitalik Buterin a few days before delivering the speech.
While Hinman asserted that the meeting with Buterin aimed to help him better understand the Ethereum network, some believed it was an attempt to provide Ethereum with preferential treatment. This led to concerns that he had disregarded the SEC’s warnings from the beginning.
Hoskinson Maintains His Stance
Charles Hoskinson clarified that the ETHGate theory had generated discussions in the crypto community, encompassing two main aspects. The first aspect pertains to allegations that Ethereum officials used their connections, relationships, or financial influence to sway SEC insiders.
The second aspect revolves around claims by XRP community members that Ethereum officials influenced the SEC to target Ripple and XRP. However, Hoskinson emphasised that there is no concrete evidence to substantiate the second aspect of these claims.