The United States Securities and Exchange Commission (SEC) continues to be at the center of attention regarding its approach to crypto regulations. Indeed, the agency has faced criticism from key crypto players who accuse it of attempting to sabotage the sector.
In one of the latest critiques of the agency, Ripple CEO Brad Garlinghouse, in an X (formerly Twitter) post on August 29, referred to the SEC as ‘out of control’ in its approach to managing the cryptocurrency sector.
According to Garlinghouse, the SEC has consistently made mistakes in both its interpretation of facts and the law. Garlinghouse’s comments came in the wake of a similar sentiment expressed by Ripple’s Chief Legal Officer, Stuart Alderoty, who highlighted the SEC’s recent legal setbacks and criticisms from the judiciary.
“While these are great outcomes… and it’s feeling like a summer of justice… it’s sad that so many in the US crypto community have to resort to the legal process to prove this SEC is out of control and consistently WRONG on the facts and the law,” Gralinghouse said.
‘SEC getting battered in court’
The executive expressed these sentiments following a statement made by Alderoty in another post, where he stated that the SEC was getting battered in the courtroom. Alderoty made this statement in reference to a series of recent developments that have not been favorable for the regulatory agency.
One particularly noteworthy incident Alderoty mentioned was an appeals court’s decision to instruct the SEC to reevaluate its rejection of Grayscale’s spot Bitcoin Exchange-Traded Fund (ETF) application. This decision potentially paves the way for approval of the cryptocurrency-based ETF, marking a substantial shift in the SEC’s stance on cryptocurrency-related financial products. According to Alderoty:
“The SEC is getting battered in the court. In our case it’s been proven wrong, been called hypocritical, lacking faithful allegiance to the law, fined for discovery abuses and now another distinguished court saying it’s “arbitrary and capricious”
Garlinghouse’s statement highlights the ongoing legal battle between Ripple and the SEC, which is poised to enter its second phase with an appeal and trial. Notably, Ripple has claimed a partial victory as the court ruled that XRP tokens are not securities.
However, despite the SEC’s plans for an appeal, this decision has raised questions about the agency’s regulatory approach in the rapidly evolving digital asset landscape.
Significantly, the recent ruling on a spot Bitcoin ETF further adds to the regulator’s mystique, as it has not yet approved any such product in the United States. Following this ruling, there is growing anticipation that approval for a spot Bitcoin ETF is on the horizon.
Image via Brad Garlinghouse’s X account