Key Highlights:
- Ripple CEO Brad Garlinghouse asserts Ethereum and XRP are not securities amidst heightened SEC scrutiny. Opposing MicroStrategy CEO Michael Saylor’s claims.
- Despite ongoing SEC scrutiny, a U.S. federal judge ruled XRP as not a security. Prompting Consensys Inc. to challenge regulatory overreach.
- The debate intensifies as the SEC investigates Ethereum transactions, while attention shifts to the potential approval of a spot-based Ethereum ETF.
Brad Garlinghouse asserts Ethereum and XRP are not securities amidst SEC scrutiny.
Ripple CEO Brad Garlinghouse lends his support to Ethereum amid a heightened SEC investigation into whether specific ETH transactions are classified as securities.
Garlinghouse’s endorsement follows MicroStrategy CEO Michael Saylor’s claim that ETH is an unregistered security.
According to Saylor, assets such as ETH, XRP, Solana (SOL), Binance Coin (BNB), and Cardano (ADA) will never see exchange-traded funds (ETFs) due to their unregistered securities status.
Refuting Securities Tag for ETH and XRP
Contrary to Saylor’s view, Garlinghouse firmly opposes the notion. During his fireside chat with Arrington Capital founder and partner Michael Arrington at the XRP Las Vegas 2024 event, Garlinghouse criticized the SEC’s involvement of both assets in its securities probe.
He emphasized the SEC’s error in the matter. labeling the agency’s actions as “grossly wrong.” Garlinghouse did not hold back, describing SEC chair Gary Gensler as an “unethical human being.” The Ripple CEO’s sentiments were shared by pro-crypto journalist and Fox Business reporter Eleanor Terret.
This isn’t the first instance where Garlinghouse has shown support for ETH. Back in March, he confidently stated that the SEC would falter in its attempt to label ETH a security, similar to its failed attempt with XRP.
SEC Scrutiny on ETH and XRP Continues
For those unfamiliar, both XRP and ETH have been under the SEC’s regulatory microscope. In 2020, the agency filed a lawsuit against Ripple, labeling XRP a security. However, last year saw significant pushback when a U.S. federal judge ruled that XRP did not qualify as a security. The judge also found Ripple in violation of the law for offering and selling the coin to institutional clients.
Despite this, the SEC has not definitively classified Ethereum as a security. Instead, the regulatory body is investigating whether certain ETH transactions constitute investment contracts, a specialized form of security.
Response to the SEC’s Scrutiny
Consensys Inc., a leading software development company founded by Ethereum co-founder Joseph Lubin, filed a lawsuit against the regulator in a Texas court, citing regulatory overreach. Consensys argued that the SEC is attempting to regulate ETH as a security despite lacking securities characteristics. The company strengthened its argument by referencing a prior statement from the SEC affirming that ETH falls outside its regulatory purview.
The characterization of Ethereum as a non-security was provided by William Hinman, former director of the SEC’s Corporation Finance division. Currently, much attention is on how the SEC’s ongoing scrutiny might impact its potential approval of a spot-based Ethereum ETF this month.
Conclusion
The debate surrounding the securities status of cryptocurrencies like Ethereum and XRP remains contentious, with key industry figures and regulatory bodies at odds. Ripple CEO Brad Garlinghouse’s staunch opposition to labeling Ethereum and XRP as securities highlights the complexity of the issue.
As the SEC continues its scrutiny, recent legal rulings and ongoing challenges from companies like Consensys Inc. underscore the evolving landscape of cryptocurrency regulation. The outcome of these debates and investigations will undoubtedly shape the future of digital asset markets and regulatory frameworks.
Disclaimer
The information provided in this article is for informational purposes only and should not be considered financial advice. The article does not offer sufficient information to make investment decisions, nor does it constitute an offer, recommendation, or solicitation to buy or sell any financial instrument. The content is the opinion of the author and does not reflect any view or suggestion or any kind of advice from CryptoNewsBytes.com. The author declares he does not hold any of the above-mentioned tokens or receive any incentive from any company.
