Ripple CEO: XRP lawsuit expected to be finalized in 2023

Ripple CEO talks lawsuit with SEC

Brad Garlinghouse, CEO of US Ripple, said on the 2nd that the trial between Ripple and the US Securities and Exchange Commission (SEC) over the crypto asset (virtual currency) XRP will be concluded by the end of 2023. I said I would leave. Bloomberg reported.

Ripple does not control the timing of a ruling, such as the first half or the second half of this year, he said. “The judge must be aware that this case will continue to be an important case,” he said.

Garlinghouse has also criticized the way the SEC regulates the cryptocurrency industry.

It is a form that casts doubt again on cracking down by taking legal enforcement measures such as lawsuits before presenting clear guidelines. He also pointed out that the U.S. lagging behind in regulation is causing crypto companies to flee to foreign countries that have established regulatory regimes that balance consumer protection and the growth of the crypto industry.

Garlinghouse likens the current situation to the rise of the Internet in the 90s. Some people argued that the Internet was being used for illicit purposes, but the US government chose to create a regulatory framework.

Garlinghouse said it has attracted investors and entrepreneurs to the U.S. and has given leading companies like Amazon and Google the geopolitical advantage of being based in the United States. He also pointed out that virtual currency, which is a new technological revolution, should be avoided from leaking overseas.

He continued that some cryptocurrencies should not be considered securities, and that once they are regulated as securities, they will become a hurdle for trading and remittances.

Submit final documents

Garlinghouse is hoping for a ruling by the end of the year after both the SEC and Ripple filed their final documents in December 2022 in a lawsuit over the securities nature of XRP.

In September 2022, the SEC and Ripple filed a motion for summary judgment in the New York federal district court, and have each filed a response to the motion for summary judgment. A “summary judgment” is a judgment rendered by the court based on the arguments stated in the submitted documents, without the formal examination of facts (judgment).

“The SEC failed to prove that the sale of XRP was an investment contract,” Ripple said in its filing. The SEC, on the other hand, maintains the exact opposite position of Ripple, arguing that XRP has an investment contractual nature and is therefore considered a security.

connection: US Ripple and SEC submit final documents to court

Criticism of “crackdown by legal measures”

Regarding the fact that the SEC is cracking down through lawsuits without showing clear guidelines, voices of criticism are being raised not only from the cryptocurrency industry but also from within the SEC. For example, SEC Commissioner Hester Pearce, known as the “Crypto Mom” who advocates for cryptocurrencies, has criticized the SEC’s response to continuing to regulate the cryptocurrency industry through enforcement actions as neither efficient nor fair.

When Garlinghouse was also asked during the interview why he didn’t register XRP with the SEC, he replied that such guidelines weren’t in place in the first place.

Lawsuit over staking service

In a recent move by the SEC, it filed a lawsuit against cryptocurrency exchange Kraken for violating securities laws, alleging that the staking service it offered was a securities law violation. Kraken has reached a settlement with the SEC, agreeing to pay approximately ¥4.1 billion ($30 million) in fines, etc., and to cease providing staking services in the United States.

The SEC’s main issue is that Kraken’s services offer fees of up to 21% per annum, but that the company did not disclose enough information about the sources of those fees. There is some debate in the cryptocurrency community about whether the SEC’s move only concerns Kraken’s services, or whether it could affect other companies’ staking services as well.

connection: How to view the Kraken indictment of the US SEC, and consider the impact on Ethereum staking

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