SEC v. Ripple: CEO Brad Garlinghouse seeks info on XRP sales from Binance

Rick Steves

“The SEC’s failure to allege domestic offers and sales should be fatal to its claims for the reasons set out in the motion to dismiss.”

In the context of the SEC v. Ripple lawsuit, in which the agency claims individual defendants Brad Garlinghouse and Chris Larsen aided and abetted in the sale of unregistered securities, the Ripple chief executive officer has filed a motion to obtain international discovery.

The individual defendant is seeking to obtain documents from Binance Holdings Limited, the cryptocurrency exchange operator, according to the documents.

“Mr. Garlinghouse seeks foreign discovery on the basis of his good faith belief that the listed entity possesses unique documents and information concerning this case, and specifically, concerning the process by which transactions in XRP allegedly conducted by Mr. Garlinghouse on foreign digital asset trading platforms were conducted.”

SEC v. Ripple: XRP is not subject to SEC under pending bill, said attorney Thien-Vu Hogan

The SEC alleges that the Ripple CEO sold more than 357 million units of XRP to “public investors in the market”. The agency seeks disgorgement based on the sales, including those sales made on digital asset trading platforms located outside the United States.

The letter states that, according to the law, disgorgement applies only to domestic sales of securities and the sales of XRP were “overwhelmingly made on digital asset trading platforms outside the United States”.

“The SEC’s failure to allege domestic offers and sales should be fatal to its claims for the reasons set out in the motion to dismiss.”

Brad Garlinghouse, Chief Executive Officer at Ripple and one of the two individual defendants in the lawsuit, seems to be planning to use the documents provided by Binance as proof that most sales of XRP formally took place outside the United States, the only jurisdiction that matters for the SEC.

These documents will be used to fight damage claims as the agency has no jurisdiction over the sales of securities outside the country. Whether XRP is a security or not is a different matter, which is yet to be answered in court or Congress.

In the meantime, the Securities and Exchange Commission has added a new trial lawyer to its team, attorney Pascal Guerrier. It seems that news settled a discussion among two prominent lawyers over the chances of an early settlement.

Attorney Jeremy Hogan argued a settlement was around the corner. He made his case based on a string of events – which he called “strange things” – that have been taking place since June and even led him to suspect the deposition of ex-SEC Director William Hinman on July 27 didn’t even happen.

Attorney James K. Filan saw things differently: “I don’t think there are any indications that either party will go quietly into the night, whether it’s on Howey, aiding and abetting or the fair notice defense.”

Read this next

Institutional FX

Swedish online brokerage pioneer Nordnet deploys Citi Securities Lending Access platform

“Nordnet was one of the first online brokers in Sweden and has since expanded into a pan-Nordic leading digital platform for savings and investments. We are proud to add this collaborative initiative to our ever-growing list of market innovations for our customers.”

Digital Assets

Elwood integrates Fireblocks to further connect digital asset ecosystem

“As a first port of call, the integration of Fireblocks will enhance the portfolio management system experience for clients, providing users with a comprehensive view of their current and historical digital asset positions across all venues, including their Fireblocks movements and balances.”

Industry News

OKX to open office in Australia, starts rivalry with Kraken in Formula 1

“Our ambition is straightforward – to become the leading crypto platform in the world. We see Australia as an indispensable part of this strategy and a key growth market.”

Executive Moves

Freemarket taps Greg Sherwin as CTO of international payments and FX-focused fintech

“At Freemarket, we are focused on providing the best optimized cross-border payments and currency exchange service to our customers and Greg’s exceptional technology expertise will help us deliver even more for our customers and support their future growth and success.”

Digital Assets

Boerse Stuttgart Digital secures BaFin authorization for crypto custody

“This is the first time that an established market participant has been licensed to hold cryptocurrencies in custody without any acquisitions. This completes the unique infrastructure we offer: of all the traditional service providers operating in the European crypto market, we are now the only one-stop-shop that’s fully regulated by BaFin in Germany for brokerage, trading, and custody of digital assets. For banks, brokers, asset managers, and family offices, this makes us the infrastructure partner of choice.”

Executive Moves hires Simone Manni as Head of Marketing, Europe

“I am proud to join, a dynamic, fast-growing FinTech company harnessing technology to disrupt traditional access to financial markets. My focus over the next few years will be to grow’s market share across western Europe and to gain a stronger foothold in countries like Italy and Germany which boasts a mature and sophisticated trading community.”

Retail FX

Axi extends partnership deal with Manchester City

FX broker Axi, previously known as AxiTrader, has renewed its flagship sponsorship deal with soccer giant Manchester City.

Digital Assets

Russia delays digital ruble pilot to May

Russia has postponed its central bank digital currency (CBDC) pilot indefinitely, which was originally scheduled for April 1, as it awaits specific legislation to be voted before the “crypto ruble” trial.

Executive Moves

Scope Markets promotes James Hughes to head of marketing

Belize-based FX and CFDs brokerage Scope Markets has promoted James Hughes, who until recently was its head of brand, to take on an expanded role as the company’s global head of marketing.