Ripple CEO Brad Garlinghouse Slams SEC for Losing Sight of Protecting Investors
During the Ripple Swell event in Dubai, Brad Garlinghouse, CEO of Ripple, spoke to CNBC’s Dan Murphy and expressed scathing criticism of the U.S. Securities and Exchange Commission (SEC). Garlinghouse stated that “I think the SEC, in my opinion, has lost sight of their mission to protect investors.”
The comments come amid Ripple’s ongoing legal battle with the SEC. In 2020, the SEC accused Ripple and its executives of conducting a securities fraud through the sale of XRP tokens. However, in July, a judge ruled that XRP was not a security, marking a pivotal victory for Ripple. This was followed by the SEC dropping securities law violation charges against Garlinghouse and Ripple executive Chris Larsen in October.
Ripple’s win in court has emboldened Garlinghouse to criticize the SEC’s approach to crypto regulation. He expressed hope that the U.S. will move beyond litigation-driven regulation and introduce federal laws governing digital currencies.
In particular, Garlinghouse called out the SEC’s repetitive use of lawsuits, stating that it was time for the agency to realize that their approach had to change. He pointed to an appeals court ruling against the SEC’s rejection of an application from digital asset manager Grayscale to create a bitcoin ETF, claiming that the agency’s regulation through enforcement had to break.
Ripple is a payments company specializing in cross-border money transfers and leverages XRP, a cryptocurrency, to facilitate these transactions. While XRP is commonly associated with Ripple, the company denies its classification as a security and asserts that it should be considered a currency or commodity instead.
With Ripple’s legal victory, Garlinghouse hopes that the U.S. will embrace an industry with immense potential by introducing federal laws for digital currencies. This would mark a shift from the current situation where crypto regulation is driven by litigation, providing clarity and stability for the industry.