Brad Garlinghouse, Ripple’s CEO, has responded to a Wall Street Journal opinion piece that was critical of SEC Chairman Gary Gensler’s approach to regulation in the cryptocurrency industry.
In a tweet, Garlinghouse shared an excerpt from the WSJ article, which argues that Gensler’s “regulation by enforcement” approach is counter-productive.
According to Garlinghouse, the WSJ article should be enough to trigger congressional action that would stop Gensler from continuing his current approach. However, Garlinghouse noted that if the U.S. Congress is not moved by the WSJ opinion piece, he is not sure what would motivate them to take action.
“If that doesn’t call for Congressional action to stop Chair Gensler’s preferred method of regulation by enforcement, I’m not sure what does,” Garlinghouse tweeted.
.@WSJopinion writes “Mr. Gensler’s blockade is counter-productive if his aim is to protect investors.”
If that doesn’t call for Congressional action to stop Chair Gensler’s preferred method of regulation by enforcement, I’m not sure what does…https://t.co/4mhxBEauN6
— Brad Garlinghouse (@bgarlinghouse) July 7, 2022
In crypto world, the SEC has been characterized as a regulator that likes to play things close to the chest. For years, industry players have urged the agency to come up with a more transparent guidance around digital assets and blockchain-related projects.
The SEC has rejected the notion of non-transparency- insisting that its approach to digital asset regulations are clear, without giving any further guidance. However, when crypto-related firms attempt to interpret and navigate these enigmatic rules, the SEC is quick to swoop in and charge them with violating its policies.
This has caused many crypto businesses to tread cautiously, fearful of getting a Ripple-like treatment. That case, of course, is the lawsuit brought in Dec. 2020 by the SEC against the blockchain-based payments network. The Commission alleges that Ripple violated federal securities laws by selling more than $1.3 billion worth of its native token, XRP, to investors without registering them as securities.
Ripple has denied the SEC’s allegations, arguing that XRP is not a security and that selling it was compliant and not materially different from sales of Ethereum (ETH) and Bitcoin (BTC).
Garlinghouse’s WSJ comment echoes the continuous argument from the crypto industry about the methods the SEC uses in the current uncertain regulatory environment for the crypto industry.
It remains to be seen if the agency and its chairman will heed these calls for more transparency, or if they will continue to operate in the same unclear and uncomprehensible manner.
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