- Ripple CEO Brad Garlinghouse believes that similar to the XRP lawsuit, the SEC will fail in its attempt to classify Ethereum (ETH) as a security.
- Ripple’s Chief Legal Officer, Stuart Alderoty, has called for US Congress intervention in the ongoing regulatory challenges, urging Congress to halt funding for the SEC.
Brad Garlinghouse, the CEO of Ripple, expressed his belief that the U.S. Securities and Exchange Commission (SEC) will fail in its attempt to classify Ethereum (ETH) as a security, just as it did with XRP.
In a recent post on the X platform, Garlinghouse responded to reports about the SEC’s legal efforts to categorize Ethereum as a security. He also highlighted the SEC’s track record of losses in legal battles with the crypto industry and suggested that the regulator is now turning to disputes with other agencies, such as the U.S. Commodity Futures Trading Commission (CFTC).
Garlinghouse posed a rhetorical question regarding when the SEC would realize its likely defeat in the attempt to classify ETH as a security. The Ripple CEO further cited parallels to SEC’s unsuccessful efforts with XRP. He made these remarks in response to comments made by Coinbase’s Chief Legal Officer, Paul Grewal, who voiced support for Ethereum and presented arguments against its classification as a security, as reported by Crypto Key News.
The SEC picked fights with the industry and is losing badly in the Courts. They’re now fighting fellow regulators like the CFTC, and falling behind international counterparts. At what point will the SEC realize they will lose the war against ETH just as they lost against XRP? https://t.co/rG66npldf4
— Brad Garlinghouse (@bgarlinghouse) March 21, 2024
Ripple executive expressing support for Ethereum comes as a surprise to many in the crypto community. This is especially true considering the critical remarks made by Ethereum creator Vitalik Buterin towards XRP when the SEC filed a lawsuit against Ripple in 2020.
Ripple CLO Wants US SEC to Intervene
Ripple’s Chief Legal Officer, Stuart Alderoty, responded to Brad Garlinghouse’s post on X, urging the US Congress to intervene in the ongoing regulatory issues. He emphasized the need for Congress to cease funding the SEC, labeling such actions as “insanity.”
Congress must stop funding this insanity. https://t.co/ivS0kg2YoL
— Stuart Alderoty (@s_alderoty) March 21, 2024
Alderoty has been a vocal critic of the U.S. SEC’s regulatory actions and policies under Gary Gensler’s leadership. Recently, he criticized the SEC for misleading the court and abusing its power in the Debt Box case.
In contrast to the SEC’s stance, Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam testified before the House Committee on Agriculture, refuting the SEC’s classification of ETH as a security. Behnam also opposed Prometheum’s proposal to offer ETH custody services, asserting that “Both Bitcoin and Ether are commodities”.
If the SEC manages to classify ETH as a security, the likelihood of a spot-based Ethereum ETF being introduced in the near future would diminish. There has been optimism among crypto enthusiasts regarding the approval of an Ethereum ETF by the regulator this year, similar to the one approved for Bitcoin in January.
Previously, leading experts anticipated that the approval could occur by May 2024. However, amid the SEC’s efforts to subject ETH to its regulatory oversight, investors’ expectations with the launch of an Ethereum spot ETF in May are dwindling, reported Crypto Key News.
