SEC v. Ripple: XRP’s utility and currency value backed by former U.S. Treasurer
Ripple has just gained a high-profile backer for its cryptocurrency lawsuit of the century.
Rosie Rios, the 43th Treasurer of the United States from 2009 to 2016 under President Barack Obama, has made quite a statement as the SEC v. Ripple lingers and CEO Brad Garlinghouse refuses to settle if no “absolute certainty” about XRP is provided.
The 56 year-old academic took to Twitter to send a message to everyone out there still figuring out if XRP fits the description of a security under the ‘Howie Test’ as the Securities and Exchange Commission claims.
“XRP’s primary purpose is facilitating cross-border payments while other #Cryptos find their value in speculation. China’s latest move brings this point home”, Ms. Rios stated.
The first claim – XRP’s primary purpose is facilitating cross-border payments – is a clear defense of the asset’s utility, which is something the court had stated back in March in what was viewed as a bombshell against the SEC’s complaint.
The second claim – while other Cryptos find their value in speculation – further detaches Ripple’s XRP from much of the speculation surrounding the digital asset space, which implicitly points to its ‘currency value’.
Both utility and currency value are features not found in securities and this statement is being made by a former United States Treasurer, thus lending influence and credibility to Ripple’s arguments in opposition to the SEC.
Ripple CEO Brad Garlinghouse has recently told Fox Business that the blockchain firm is only willing to settle with the SEC if there is “absolute certainty” about XRP.
“To the extent we can find a constructive path forward with the SEC, we, of course, want to find that. There is no scenario though when we going to settle unless there is absolute certainty about what is XRP on a go-forward basis.
“We have a clear vision of how XRP can be an extremely powerful tool. There’s a lot of other people in the crypto community and the XRP community doing amazing things with XRP”, he continued, stressing the XRP Ledger is a decentralized open-source technology that pre-existed the creation of the firm, which is incompatible with the definition of security under the ‘Howie Test’.
The interview also touched sensitive subjects, including the potential conflicts of interest for the suspicious timing of the lawsuit – the last day of SEC Chair Jay Clayton in office – and the SEC’s Hinman speech on Ethereum back in 2018.
John Deaton, attorney for the XRP Holders, has recently published a memo attacking several key figures in what he calls a “story of an overreaching regulator unfairly picking winners and losers in the blockchain business space, a web of insider connections and conflicts of interest, and thousands of retail investors who were egregiously harmed by the federal agency that is supposed to be protecting them”.
The key figures in the story are ex-SEC Chair Jay Clayton, ex-SEC Director William Hinman, Ethereum, ConsenSys, and the Enterprise Ethereum Alliance. Joseph Lubin and Mike Novogratz are also mentioned for knowing the SEC’s position on ETH and XRP ahead of time.
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