Ripple lawsuit raises hopes as ‘Crypto Mom’ condemns SEC policy

Rick Steves

“It is disconcerting to me that for three years now I’ve been asking for regulatory clarity, and we can’t seem to provide any”.

SEC Commissioner Hester Peirce, also known as “crypto mom” among the digital asset community, has voiced her bafflement at the agency’s lack of effort to provide clarity in the space.

Hester Peirce, who has recently published a statement together with Commissioner Elad Roisman against the way the agency is regulating cryptocurrencies, has delivered her harshest assessment yet at an interview with Yahoo Finance.

“It is disconcerting to me that for three years now I’ve been asking for regulatory clarity, and we can’t seem to provide any. I think this is really becoming a huge barrier to this industry being able to develop in a way that’s safe, but also in a way that allows innovation to happen. And it’s a real shame to me that we are not just taking up the mantle as regulators to develop a regulatory framework.”

SEC keeps on its regulation-by-enforcement mode

There are currently two out of five Commissioners publicly voicing their opposition to the SEC’s regulation-by-enforcement practice in the digital asset space.

The majority remains willing to continue to file lawsuits against established companies that have been trying to understand and follow the (rather ambiguous) regulatory framework for their activities.

Coinbase, the largest cryptocurrency exchange in the United States, has warned the public and investors that the SEC is preparing a case against the firm.

Circle, the issuer of the USDC stablecoin, has yesterday announced it is too under the scope of the securities regulator. It has received an “investigative subpoena” from the SEC’s Enforcement Division which requests “documents and information regarding certain of our holdings, customer programs and operations”.

Ripple praised Commissioner Peirce’s “safe harbor” proposal

Ripple Labs has recently provided feedback on crypto and blockchain laws, which can be summarized in three bulltet points: to encourage innovation sandboxes for crypto, increase public-private collaboration, and engagement & consideration by the Senate of existing legislative efforts.

The letter praised Commissioner Peirce’s proposal of a “safe harbor” under which network developers would be exempt for three years from the
registration provisions of federal securities laws, during which time they would be allowed to launch their products and develop their networks through token transactions.

If “network maturity” is achieved at the conclusion of the three-year period, token transactions would not trigger securities registration requirements, under SEC Peirce’s proposal.

Ripple also suggested the Senate to consider the two new proposed bills: the Securities Clarity Act (SCA) and the Digital Commodity Exchange Act (DCEA).

“Both the SCA and DCEA seek to provide legal clarity to industry, markets, and consumers in a way that an ad hoc, regulation by enforcement approach simply cannot.

“Moreover, these bills are an implicit acknowledgment that laws drafted for our legacy financial system cannot simply be overlaid on cryptocurrency and blockchain – rather, a tailored, flexible approach designed to address and remedy the specific challenges presented by this space is required. Ripple encourages the Senate to consider both the SCA and DCEA as they work to provide the certainty that is needed to keep industry within the United States while also maintaining the strong consumer and investor protections that have made American capital markets the best in the world”.

SEC v. Ripple as the game changer

Talk of lack of clarity for the cryptocurrency space in the United States has been ongoing for years, but the SEC v. Ripple lawsuit has raised the stakes for everyone.

The “cryptocurrency trial of the century” is likely to set precedent and Ripple has no plans to settle for cheap. The blockchain firm eyes the lawsuit has an opportunity to help correct the regulatory environment for everyone within the crypto industry.

Using the words of Jeremy Hogan, an XRP community-friendly attorney, Ripple could save the industry from the SEC.

XRP Holders have most recently scored a major win despite seeing its motion to intervene denied. Judge Analisa Torres has granted them the Amicus Curiae status.

Movants, in their individual capacities, shall be permitted to act as amici curiae in this action. As such, Movants shall be allowed to assist the Court by briefing legal issues relevant to the case as approved in advance by the Court”, the Order stated.

There’s more on Ripple:

Ripple pushes SEC up against the wall: ‘If personal opinions, then no privilege”

Ripple buries SEC in paperwork in XRP lawsuit: Nearly 30,000 requests

Ripple running out of time as BIS ‘conspires’ to end cryptos’ threat to financial system

Ripple responds to Senator Toomey on XRP, the SEC, and how to do better

SEC v. Ripple: XRP’s utility and currency value backed by former U.S. Treasurer

SEC v. Ripple: What’s next on the XRP lawsuit agenda?

 

 

 

Read this next

Digital Assets

Celsius to repay +70% of custody account holders’ claims

A New York bankruptcy judge today approved a deal struck between troubled crypto lender Celsius Network and its “custody account holders” that will allow them to begin immediate withdrawals of 72.5% of their claims.

Retail FX

eToro revenue halves in 2022, valuation drops to $3.5 billion

Israeli social trading network eToro today reported financial results for the financial year ended December 31, 2022.

Uncategorized

Investors transfers $424 million out of bitcoin funds in six weeks

Despite bitcoin’s decent surge last week, which took the primary cryptocurrency up 70% from the year’s low, digital asset investment products saw outflows for the 6th consecutive week.

Digital Assets

OKX has $9 billion in ‘clean assets’, shows latest proof of reserves

OKX, formerly known as OKEx, has released its fifth proof-of-reserves report amid increasing demand of crypto investors asking for transparency from exchanges they trade with.

Digital Assets

Circle seeks France license to launch Euro stablecoin

Circle, the issuer of the second-largest stablecoin by market capitalization, is seeking to get a dual registration in France as it aims to on-shore its flagship product for the European market – EUROC – a reserve-backed stablecoin.

Digital Assets

CryptoWallet.com Among Minority of Successful Companies to Renew Coveted Estonian License

CryptoWallet.com has successfully renewed its virtual currency service license from Estonia’s FIU for the third year in a row, despite regulatory changes that have made it harder for virtual asset providers to meet the required standards.

Inside View, Institutional FX

Time for brokers to add options trading as volumes explode on high volatility

“Usually, adding options to the typical CFDs and equities offering leads to fragmentation of the platform technology as many brokers will need additional back-end and front-end components, and that could be an important barrier for them. Apart from that, legal hassle and costs associated with proper licensing of market data could be a barrier at first. We are seeing this trend among market data vendors and exchanges to make it easier and more affordable.”

Metaverse Gaming NFT

GCEX’s DeFi education and prime brokerage offering available in DubaiVerse

“We are excited to be part of the developments of The Sandbox and to join other top players in the region, including our regulator, Dubai’s Virtual Asset Regulatory Authority (VARA), as part of the DubaiVerse. This is a great opportunity to bridge the gap between Web3 early adopters and GCEX clients, building a community around Web3 and digital assets.”

Digital Assets

Circle wants Fed to back USDC stablecoin after “very serious stress test” with collapse of SVB

The collapse of Silicon Valley Bank allegedly proves Circle’s point that there is a need for its USDC stablecoin to be backed by the U.S. Federal Reserve with its U.S. dollars held at the Fed.

<