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- Ripple lawyer Stuart Alderoty lashed out at Gary Gensler stating that he has prejudiced the decision of crypto assets as securities. Thus, he must rescue himself from voting on an enforcement case.
- Gary Gensler’s recent comments have done enough damage to dividing the crypto community between Bitcoin maximalists and others.
In his recent interview, SEC chairman Gary Gensler noted that almost all cryptocurrencies except for Bitcoin (BTC) come under his jurisdiction and shall be treated as securities. With this, the SEC chair has sparked another major controversy drawing reactions from crypto enthusiasts and market players.
Gary Gensler said that every Crypto aside from Bitcoin has to testify under the Howey test to check if it is a security or not. However Gensler Gensler has already anticipated the outcome of this classification in a court of law, so he should not be entrusted further in decisions in this area, as he no longer has the actual decision and neutral opinion but has already anticipated the outcome.
Crypto lawyers have strongly voiced their opinions regarding Gensler’s anticipation of the outcome of this classification in the court of law. Ripple’s chief legal officer Stuart Alderoty has lashed out at Gary Gensler stating that the SEC chair will now need to rescue himself from voting on any enforcement case. In his tweet earlier today, Alderoty wrote:
Crypto lawyer PSA: Chair Gensler has again proclaimed that every cryptocurrency, except BTC, is an unregistered security. He now must recuse himself from voting on any enforcement case that raises that issue since he has prejudged the outcome. Antoniu v. SEC (8th Cir. 1989).
This tweet has been backed by another popular Ripple attorney John E. Deaton.
Brilliant move. It’s fair to say @Ripple’s GC wasn’t always in-house counsel. Someone’s tired of playing defense. https://t.co/mMHC85wQMp
— John E Deaton (@JohnEDeaton1) February 28, 2023
The recent comments from the SEC Chair could spark a new debate between the agency and Ripple in their long-going legal battle.
Taking on SEC Chair and Bitcoin Maximalists
Popular crypto lawyers have come calling out that the comments of SEC Chair Gary Gensler are not legally dispositive. In his tweet, crypto lawyer Jake Chervinsky stated that the SEC doesn’t have the authority to regulate digital assets. He wrote:
Chair Gensler may have prejudged that every digital asset aside from bitcoin is a security, but his opinion is not the law. The SEC lacks authority to regulate any of them until and unless it proves its case in court. For each asset, every single one, individually, one at a time.
However, the recent attack by SEC Chair on cryptocurrencies, except Bitcoin, has created a divide in the crypto community. This divide was quite visible among Bitcoin maximalists and supporters of the broader crypto market.
MicroStrategy co-founder and popular Bitcoin proponent Michael Saylor supported Gensler’s comments. He tweeted that a consensus is building up among the industry that every other crypto in the market, except Bitcoin, is security. Many other Bitcoin maximalists also joined Saylor’s rhetoric. Lashing out at Bitcoin maximalists, crypto lawyer Jake Chervinsky wrote:
I’m old enough to remember when most bitcoiners believed in economic freedom and open market competition. I can’t believe the number of self-professed bitcoiners now saying some version of “I’m fine with the government picking winners and losers as long as the winner is my bag”.
XRP and Gold Backing
There’s also been a very strong rumor currently in the cryptosphere that XRP may be backed by Gold. But former Ripple Director Matt Hamilton debunked these rumors stating that it’s not possible. He explained that it’s not possible to inflate XRP to peg it to another asset. The only thing that’s possible is the tokenization of Gold on the XRP ledger.
