Brad Garlinghouse, the CEO of Ripple, has gone on a public defense of Ethereum in response to heightened scrutiny from the U.S. Securities and Exchange Commission (SEC) In one of the events held in Las Vegas, Brad Garlinghouse questioned SEC’s approach to Ethereum and Ripple (XRP). He argued that the regurgitative stand of the regulatory body is not very fruitful. These comments were made at a fireside chat at the XRP Las Vegas 2024 event where Michael Arrington, the founder of Arrington Capital, took the moderating role.
Following the comments made by Michael Saylor, the MicroStrategy CEO, the debate on whether Ethereum is classified as a security has gone up a notch by labeling ETH and the other major cryptos as unregistered securities. In contrast with Saylor, Brad Garlinghouse has been a constant proponent of Ethereum, demonstrating the winning of Ripple against the SEC when a judge stated that XRP was not a security.
Brad Garlinghouse’s statement was tweeted by pro-crypto journalist Eleanor Terrett in an X post, indicating his criticism of SEC chair Gary Gensler. He labeled Gensler as an “immoral human being,” saying he was overstepping the boundaries in his unitary roles.
Consensys sues SEC over Ethereum regulation
The SEC has not yet ruled whether Ethereum is a Security. Instead, the regulator is looking into ETH-related trades to find out if those are solely investment contracts. This intrusion leads to the already current debate about how such virtual currency systems are integrated into existing financial regulations and whether they should be classified as securities.
With regard to SEC’s initiatives, Consensys Inc., which is one of the important development components of Ethereum, sues the SEC in Texas. The corporation stated that the SEC is over-jurisdictionally encroached by attempting to govern ETH as a security. They evidenced their claim in support of the fact that Ethereum is not subject to SEC regulations as indicated in the previous statement.
The legal fight starts with a 2020 case in which XRP was labeled a security issued by the SEC. In this case, Ripple, rejecting the ruling, went through a legal process which ended in a Federal Judge’s decision last year that XRP is not a security, however, Ripple had violated the law when institutional customers were initially served.
Ethereum ETF hangs in balance amid probe
The SEC investigation is contributing to delaying the approval of the Ethereum ETF that will allow investors to buy Ethereum directly on the stock exchange. Investors greatly awaited such a decision. The scenario may be history, as the SEC’s ultimate decision will direct Ethereum’s regulation and its influence as a carrier of funds in the financial sector.
Earlier William Hinman, the former head of the SEC’s Corporation Finance division, pointed out that Ethereum was not regarded as a security, a previous statement had mentioned this. This family history makes today’s regulatory environment more complicated, which is the dilemma for both the SEC and those who are for cryptos.
