Bill Morgan, a pro-XRP community lawyer, has responded to comments made by Ripple’s CEO Brad Garlinghouse and General Counsel Stuart Alderoty, in which they criticized the Securities and Exchange Commission (SEC). Morgan has observed that the ongoing criticism directed by Ripple’s executives towards the SEC indicates that the blockchain company does not intend to reach a settlement with the regulator. In other words, Morgan suggests that Ripple’s leadership is continuing to publicly criticize the SEC because they are not willing to compromise or negotiate a settlement.
His comments were made in response to Brad Garlinghouse, who had previously criticized the Securities and Exchange Commission (SEC) chairman’s recent statements. Morgan has noted that Garlinghouse’s criticism is part of a larger pattern of Ripple’s leadership publicly denouncing the SEC, which suggests that the company is not planning to settle with the regulator. In essence, Morgan is suggesting that Garlinghouse’s criticism is just one example of Ripple’s ongoing opposition to the SEC’s actions.
Garlinghouse Blasts Gensler’s Comments on Cryptocurrency Regulations
Garlinghouse has reacted to Gensler’s assertion, which suggests that the SEC has a great deal of autonomy in interpreting and enforcing securities laws. In other words, Garlinghouse’s response indicates that he disagrees with Gensler’s position, and may see the SEC’s approach to regulating cryptocurrencies like XRP as overly broad or unfair.
Following his testimony on the SEC’s budget at the Appropriations Subcommittee on Financial Service and General Government, the agency’s chairman, Gary Gensler, made comments indicating that he does not believe it is necessary for the SEC to have the sole authority to determine what qualifies as a security
Gensler said he does not think the SEC requires the authority to define “what’s in or out — I think there is one agency — the Securities and Exchange Commission, overseen by two committees — the House Financial Services and Senate Banking, and the courts that define what a security is and not individual crypto exchanges selecting that,”
Gary Gensler’s recent comments on the SEC’s role in defining securities have generated a range of reactions from stakeholders in the cryptocurrency community.
However, several people within the community believe that Gensler’s comments suggest that the SEC will continue to take a hardline approach towards cryptocurrency firms, and that this could lead to continued uncertainty and ambiguity in the regulatory landscape.
Garlinghouse believes it is illogical for Gensler to suggest that the SEC has the ultimate say in defining securities, and argues that the agency should be more transparent about its decision-making process and adhere more closely to established legal frameworks.
He said:
“When you behave like an autocrat running a $2.2B bloated agency, why would you ever want to provide clarity about what’s “in or out”?
Without clear jurisdiction, ambiguity masquerades as power.”
He stated that it is easy for ambiguity to masquerade as power when there is no clear jurisdiction.
Related Reading: How Ripple and XRP Differ: Deaton Offers Clarification
For context, Garlinghouse has expressed concern about the potential for ambiguity to be misinterpreted as a show of power, particularly when there is no clear delineation of jurisdiction.
Alderoty Takes a Swipe at SEC
Ripple’s General Counsel, Stuart Alderoty, has also been critical of the SEC and its chairman in recent statements. Specifically, Alderoty has characterized the agency’s invitation to cryptocurrency companies to register with the SEC as a “bait-and-switch” tactic.
In Alderoty’s view, Gensler’s actions are motivated more by a desire to exert control over the crypto industry, rather than promoting innovation or protecting investors. Furthermore, Alderoty suggests that Gensler’s actions could actually drive cryptocurrency innovations out of the United States, and that this could have negative consequences for the broader economy.
