Ethereum
Ripple CEO sides with Ethereum, says ETH and XRP are not securities
Ripple CEO Brad Garlinghouse is backing Ethereum as the SEC steps up its investigation into whether certain ETH transactions qualify as securities.
Garlinghouse’s support comes after MicroStrategy CEO Michael Saylor called ETH an unregistered security.
As reported Earlier, Saylor said that ETH, XRP, Solana (SOL), Binance Coin (BNB), and Cardano (ADA) constitute unregistered securities. According to Saylor, these assets will never have their exchange-traded funds (ETFs) in cash.
Ripple CEO Says ETH and XRP Are Not Securities
However, Garlinghouse has a contrary opinion. Speaking during his fireside chat with Arrington Capital founder and partner Michael Arrington at the XRP Las Vegas 2024 event, Garlinghouse pointed out that the SEC was “grossly wrong” to involve the two active in its scrutiny of securities.
Ripple CEO took shots at SEC Chairman Gary Gensler, describing him as an “unethical human being.” Eleanor Terret, pro-crypto journalist and Fox Business reporter sharing Comment from Garlinghouse in an X post today.
This is not the first time Ripple CEO has expressed support for ETH. In March, the leader of Ripple asserted that the SEC would fail in its quest to label the security of ETH, the same way it lost to XRP.
Ongoing SEC Examination Targeting ETH and XRP
For the uninitiated, both XRP and ETH are subject to regulatory review by the SEC. In 2020, the agency called XRP a security in its lawsuit against Ripple.
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However, last year it came under heavy criticism when a U.S. federal judge declared that XRP is not a security. The judge also ruled that Ripple violated the law by offering and selling the coin to institutional clients.
However, the SEC has not explicitly considered Ethereum to be a security. The regulatory agency is only investigating whether certain transactions involving ETH constitute investment contracts, a special type of security.
In response to the SEC’s scrutiny, Consensys Inc., a major software development company founded by Ethereum co-founder Joseph Lubin, sued the regulator in a Texas court, citing regulatory overreach.
Consensys argued that the SEC aimed to regulate ETH as a security despite the asset’s lack of security characteristics. The company further strengthened its argument by referencing a previous SEC statement asserting that ETH is not a security and does not fall under the SEC’s regulatory jurisdiction.
The characterization of Ethereum as a non-security was issued by William Hinman, former director of the SEC’s Corporation Finance Division.
In the meantime, the main focus is on how the SEC’s scrutiny would affect the agency’s potential. approval of a spot-based Ethereum ETF this month.
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