Key takeaways:
- Ripple CEO Brad Garlinghouse told CNBC at Paris Blockchain Week on Thursday that the lawsuit with SEC is going better than he had anticipated
- Last year, the SEC charged Ripple with the sale of unregulated securities in the form of XRP
- XRP jumped 8.5% on the news of a favorable ruling made by the presiding judge in the case and the CEO’s optimistic comments
Ripple CEO Brad Garlinghouse thinks the case with the SEC “has gone exceedingly well”
Speaking to CNBC’s Ryan Browne at Paris Blockchain Week on Thursday, the CEO of financial technology company Ripple Labs revealed the high-profile lawsuit with the US Securities and Exchange Commission (SEC) has gone “much better” than he “could have hoped for when it began” in early 2021.
As a reminder, the SEC filed a lawsuit against Ripple and its executives, accusing them of facilitating a personal unregulated sale of XRP worth approximately $600 million in total. Throughout the prolonged legal battle, Ripple’s defense has always been that XRP should not be considered a security, and thus cannot be subject to securities regulation.
The company’s defense team has built a case on observations made by a former SEC official William Hinman, who ruled in 2018 that Ethereum is sufficiently decentralized and therefore can’t be considered a security. Moreover, Hinman explicitly said in a speech in mid-2018 that both Ethereum and Bitcoin are not securities.
During the interview, Garlinghouse highlighted that the outcome of this case could have far-reaching implications for the broader industry. “This case is important, not just for Ripple; it’s important for the entire crypto industry in the United States,” remarked Garlinghouse. He went on to say that if Ripple were to be found guilty of selling unregistered securities in the form of XRP, this woul entail that the majority of other tokens could also fall within the jurisdiction of securities regulation. The CEO explained:
“If you determine XRP as a security of Ripple, we have to know every person that owns XRP. That’s an SEC requirement. You have to know all of your shareholders. It’s not possible.”
Earlier this week, Sarah Netburn, a presiding judge on the regulator’s case against Ripple, ruled that documents demonstrating Hinman’s take on BTC and ETH should not be withheld by the SEC. The decision received a wave of approval in the crypto community and swung the outcome of the long-running case in Ripple’s favor.
XRP, the native digital asset of the Ripple network, jumped to a weekly high on the news and outperformed all other tokens in the cryptocurrency top 100 today. At press time, XRP is changing hands at $0.791, up 8.5% in the last 24 hours.
