Ripple CEO Takes Aim At Ex-SEC Chair Jay Clayton’s Statements

Brad Garlinghouse, the CEO of Ripple, expressed strong disapproval of former SEC Chair Jay Clayton’s comments regarding the regulatory approach of the United States Securities and Exchange Commission. In the early part of 2023, the SEC launched multiple regulatory initiatives targeting cryptocurrency exchanges and companies.

In a CNBC interview on June 29, 2023, Clayton conveyed his belief that the SEC should initiate legal proceedings against particular companies solely when there exists a robust legal foundation.

He underscored the importance of regulatory agencies enacting regulations and pursuing legal actions they are confident will stand up to rigorous judicial examination.

Considering the SEC’s decision to dismiss the allegations without prejudice, the CEO of Ripple pointed out that the former SEC chairman had pursued a lawsuit with a limited likelihood of succeeding in court.

In the legal action initiated against Ripple, Brad Garlinghouse, and Ripple’s co-founder Christian Larsen in Dec 2020, the SEC alleged that the company and these two executives conducted an “unregistered, ongoing digital asset securities offering,” asserting that they had raised over $1.3 billion through XRP sales.

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Garlinghouse stated, “To jog your memory, Jay Clayton initiated the case against Ripple, Chris Larsen, and me and then departed the organization the very next day.”

Clayton’s remarks from June 2023 have garnered significant interest in the context of the recent legal developments concerning Garlinghouse and Larsen. As previously noted, the SEC moved to dismiss the charges against these executives in Oct.

The SEC’s action comes in the wake of Judge Analisa Torres’s decision in July, which partially favored Ripple by asserting that the retail sales of the XRP token did not fall under the legal definition of a security.

Nonetheless, the court determined that Ripple had breached securities regulations by directly selling XRP tokens to institutional investors.

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The author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.

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