Pro-XRP Lawyer to SEC Chair: ‘Stop Protecting Us’
The US stance on cryptocurrency regulation has left many in the industry frustrated, with criticism focused on the lack of clear guidelines and the Securities and Exchange Commission’s (SEC) actions against digital currency firms. While other countries have adopted comprehensive frameworks, the US has yet to follow suit, with SEC Chairman Gary Gensler drawing particular scrutiny.
Gensler’s recent tweet sparked a response from Pro XRP attorney John Deaton, whose rebuttal has caused a stir in the crypto community. Read on to find out more about this ongoing controversy and its potential impact on the future of crypto in the US.
Deaton asks Chairman Gensler to stop “protecting” the American public
Renowned cryptocurrency attorney John Deaton recently took to Twitter to address SEC Chairman Gary Gensler, asking him to stop protecting the American public on their behalf. The lawyer’s comments came in response to Gensler’s expression of gratitude to the agency’s staff for their efforts to advance the SEC’s mission.
This is in light of the various harmful regulatory actions taken by the SEC against a number of crypto companies recently, including the Ripple (XRP) blockchain, the Coinbase crypto exchange, Paxos, the company that produces the BUSD stablecoin, and Bittrex, which today filed for Chapter 11 bankruptcy .
The SEC filed a lawsuit against Ripple Labs in December 2020, alleging that the company had conducted an unregistered security offering by selling XRP. The SEC believes that XRP is a security because it meets the definition of an investment contract under the Howey test. Ripple and Deaton argue that XRP is a digital currency and not a security. The trial is ongoing, with several legal filings over the past three years.
Deaton challenges legal precedent in investment contract cases
In a recent Twitter post, blockchain attorney John Deaton challenged legal precedent in investment contract cases, stating that no case in the past 76 years has considered the underlying asset security.
Deaton came to this conclusion after conducting extensive research and examining the findings of legal experts such as Lewis Cohen, a New York-based attorney who authored the book “The Ineluctable Modality of Security Law: Why Fungible Crypto Assets Are Not Securities.” The lawyer’s remarks are important in light of the ongoing litigation between the SEC and Ripple over the classification of XRP.
