Stuart Alderoty, Ripple’s general counsel, has criticized the United States Securities and Exchange Commission (SEC) for what he perceives as hypocrisy regarding the commission’s stance on untrue statements or omissions in registration statements. Alderoty specifically pointed out the SEC’s issuing of stop orders to block registration statements that contain falsehoods.
This scrutiny comes in the wake of the SEC charging Coinbase, a prominent cryptocurrency exchange, with operating as an unregistered securities exchange, broker, and clearing agency. According to the SEC’s complaint, Coinbase has allegedly facilitated the buying and selling of crypto asset securities unlawfully since at least 2019.
Alderoty highlighted the SEC’s inconsistencies by drawing attention to the statement made by Coinbase that they were not registering as a broker-dealer, securities exchange, or ATS (alternative trading system) because they were not trading securities.
He suggested that if the SEC believed this statement to be untrue, it should have been blocked. Alderoty further emphasized the SEC’s recent lawsuits against major exchanges like Binance and Coinbase, characterizing the commission’s approach as a “strategy of shock and awe.” He expressed his confidence in upholding the rule of law.
Adding to the unfolding situation, publicly redacted documents from former SEC official William Hinman, as well as cross-motions for summary judgment in the ongoing Ripple lawsuit, are expected to be released on June 13.
Notably, in a 2018 speech, Hinman declared that Ethereum should not be considered a security. The anticipation surrounding the Hinman documents is growing, especially in light of the recent legal actions against Binance and Coinbase, and their potential implications for the broader cryptocurrency sector.
A vocal member of the XRP community, known as “Mr. Huber,” has shared his expectations for the upcoming Hinman document reveal. According to him, the documents will have adverse effects on the crypto industry as a whole but will benefit Ripple. Mr. Huber believes that the SEC’s entire cryptocurrency policy, based on Hinman’s speech, will be deemed illegitimate, exposing a potential flaw in the commission’s approach.
As the crypto community eagerly awaits the release of the Hinman documents and the outcome of the Ripple lawsuit, industry observers are closely monitoring these developments to understand the potential ramifications for the cryptocurrency market and regulatory landscape.
