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Ripple’s Chief Legal Counsel Strikes Back: Calls Out SEC and Chair for Legal Consequences

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  • Ripple’s Chief Legal Counsel, Stuart Alderoty, is among those advocating for greater accountability from the SEC, highlighting the potential legal implications of Chairman Gary Gensler’s statements on digital assets.
  • Doubts have been cast on the integrity of the SEC’s enforcement actions, with critics arguing that the agency appears to be favoring certain entities, such as the now-bankrupt FTX derivatives exchange, over others.

As the United States Securities and Exchange Commission (SEC) navigates the regulatory challenges of the nascent digital asset industry, calls for accountability among its leadership are intensifying. Leading this chorus is Stuart Alderoty, Ripple Labs Inc’s Chief Legal Counsel, who recently underscored the potential legal repercussions of comments made by SEC Chairman Gary Gensler.

This issue was brought to the forefront by a tweet from Blockchain Association Policy Lead, Jake Chervinsky. Chervinsky alleges that Gensler has prematurely classified all digital assets, barring Bitcoin, as securities. This presumption, he argues, compromises Gensler’s capacity to conduct impartial enforcement actions related to digital assets.

In the traditional securities market, enforcement actions initiated by the SEC follow the Wells Process, wherein cases presented by the agency’s staff are neutrally reviewed by its commissioners. Chervinsky asserts that Gensler, by preemptively categorizing most cryptocurrencies as securities, has strayed from the path of unbiased arbitration expected from a senior official.

This viewpoint is shared by numerous industry insiders who believe Gensler’s sweeping categorization is not only inaccurate but also indicative of a reluctance to perform the careful analysis required to determine the true nature of each digital asset.

Questions regarding the SEC’s integrity have also emerged in the wake of its numerous enforcement actions against prominent crypto exchanges, including Kraken, Bittrex, Coinbase, and Binance. Observers have pointed out the seeming disparity in the regulator’s approach, particularly with respect to the now-insolvent FTX derivatives exchange, which was not sued despite alleged unlawful operations. Binance CEO Changpeng “CZ” Zhao has joined the conversation, fueling doubts about the fairness of the SEC’s enforcement activities.

In the midst of this controversy, pro-XRP attorney John E. Deaton has refuted rumors suggesting that the ongoing SEC vs. Ripple lawsuit is staged. He emphasizes that Ripple’s substantial legal expenses and the impact of the lawsuit on crypto exchanges, including Coinbase and Kraken, stand testament to the lawsuit’s real-life consequences.

As the crypto industry continues to mature, the call for regulatory clarity and accountability from bodies like the SEC becomes increasingly critical. The conversation around the SEC’s role and its chair’s impartiality has ramifications beyond the immediate stakeholders, potentially shaping the future of digital assets on a global scale.

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AnnJoy Makena
AnnJoy Makenahttps://www.ethnews.com
Annjoy Makena is an accomplished and passionate writer who specializes in the fascinating world of cryptocurrencies. With a profound understanding of blockchain technology and its implications, she is dedicated to demystifying complex concepts and delivering valuable insights to her readers. Business Email: info@ethnews.com Phone: +49 160 92211628