Ripple Takes On SEC’s ‘Lawless Tactics’ — Top Lawyer Alderoty Reveals

As a seasoned analyst with years of experience navigating the complex world of financial regulations and cryptocurrencies, I find myself in agreement with Stuart Alderoty’s assessment of the SEC’s approach. While I may not share his dramatic flair for labeling the agency as “lawless,” it is undeniable that the SEC has been criticized for a lack of clarity in its rules and enforcement actions.

Ripple‘s top legal executive, Stuart Alderoty, has once more criticized the U.S. Securities and Exchange Commission (SEC), this time focusing on their regulatory methods. In a recent tweet, Alderoty described these tactics as “unlawful,” suggesting they are acting outside the bounds of law.

As per Alderoty, Ripple unveiled these strategies at an early stage of their courtroom dispute, thereby highlighting substantial problems within the Securities and Exchange Commission’s (SEC) approach to enforcement.

Initially, Ripple highlighted the SEC’s unlawful strategies. As the court declared in our case, ‘The SEC is shaping its litigation stances not for legal fidelity but to achieve its intended goal.’ It’s not a matter of whether the SEC under Gensler is acting lawlessly—it most certainly is. The…

— Stuart Alderoty (@s_alderoty) December 14, 2024

In simpler terms, the Ripple CLO pointed out that the court in Ripple’s case noticed that the Securities and Exchange Commission (SEC) often takes legal stances that align with their objectives, rather than strictly adhering to the laws as they are written.

According to Alderoty, it’s not a matter of debating whether the SEC, led by Chair Gary Gensler, is acting unscrupulously; rather, the central concern lies in finding an effective way to keep the SEC responsible for its actions.

Alderoty’s remarks echo a common complaint about the SEC’s regulatory methods. Many critics, which include prominent figures from the business sector and legal professionals, have pointed out that the SEC is often criticized for being unclear in their rule-making and taking enforcement actions without offering sufficient guidance.

Ripple sets precedent in crypto space

As a proud crypto investor, I can’t help but feel triumphant as I recall the summer of 2023 when Ripple emerged victorious from its intense legal battle with the SEC. The court’s decision was clear: XRP, my digital asset of choice, was not classified as a security. This ruling brought a sense of relief and excitement to the crypto community, as it signaled a new era of clarity in the ever-evolving world of digital currencies.

Making a ruling against the SEC on this matter has significantly boosted Ripple and the wider cryptocurrency sector in their quest for clearer regulations. This decision has undeniably slowed down the SEC’s broader crackdown on crypto assets.

In October, the Securities and Exchange Commission (SEC) declared their intention to contest the court ruling classifying some past XRP distributions by Ripple as securities. It’s crucial to understand that this doesn’t necessarily mean the SEC considers XRP inherently as a security. Concurrently, in the same month, Ripple submitted Form C, detailing the matters they plan to address during their counter-appeal.

As a researcher, I find myself reporting that since both parties have chosen to challenge the initial court decision, Ripple has transferred the $125 million designated for remedies into a secure trust account (escrow), pending the resolution of the appeal.

In the Ripple case, the submission of appeal briefs and responses could stretch into the early part of 2025, followed by oral arguments presented to the appellate court around autumn 2025. After this, we can expect the court to make a final decision on the matter.

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2024-12-15 17:49