Ripple CEO Brad Garlinghouse accused Securities and Exchange Commission (SEC) Chairman Gary Gensler of not relying on laws governing his agency’s authority to determine which crypto tokens are securities and He accused the agency of claiming to have the authority to determine what is a security.” Ripple executives stressed that “it’s time for the U.S. electorate to take notice.
Ripple CEO Slams SEC Chair Gensler on What is Security
Ripple Labs CEO Brad Garlinghouse has criticized U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler for dictating which crypto tokens are securities Garlinghouse tweeted Thursday:
It is beyond comprehension that the Chairman of the SEC would claim to determine what is a security rather than the law that derives from his authority. It is time for elected officials in the United States to take notice.
If they are going to act like dictators running a bloated institution costing $2.2 billion, what needs to be clear on what is “in or out?” Without clear jurisdiction, Gerlinghaus cautions, “ambiguity masquerades as power.
Ripple executives issued thisstatement in response to Gensler’s assertion that current securities laws “cover most of the activity happening in the crypto markets.”The SEC chief was quoted as saying: “If Congress were to act, I need these powers not to inadvertently undermine through the definition of what is in or out, or essentially not allow conflicts that we do not allow.” Gensler warns:
I think many legislative measures, if adopted, would undermine the mission of securities.
Since the SEC filed suit against Ripple, Garlinghouse, and co-founder Chris Larsen in December 2020, the company has been embroiled in a legal dispute with securities regulators; the SEC argued thatXRPis a security, but Ripple and Garlinghouse have consistently argued that it is not a security.
Gensler has on several occasions stressed the importance of cryptocurrency exchanges and lending platforms coming to discuss how to comply with the SEC. However, Garlinghouse accuses the securities watchdog of holding meetings with crypto companies primarily for the purpose of gleaning clues from the Enforcement Division. There are also widespread complaints that the SEC does not provide clear regulatory guidelines, making it difficult for companies in the crypto sector to ensure compliance.
Recently, Coinbase, a NASDAQ-listed crypto exchange, received a Wells notice from the SEC regarding potential securities law violations. The company noted in its response: “The SEC does not allow crypto companies to ‘come in and register’ – we tried.” Meanwhile, Gensler reiterated that all crypto tokens except bit