The Ripple Chief Legal Officer (CLO) Stuart Alderoty has drawn the crypto community’s attention to a court transcript highlighting the SEC’s (Securities and Exchange Commission) lack of clear-cut rules for companies it regulates.
SEC’s Rules Are “So Vague And Loosey-goosey”
Alderoty shared a part of the Judge’s statement in the case of NCPPR v. SEC in an X (formerly Twitter) post. In that case, the Judge remarked that the SEC’s rules were “so vague and loosey-goosey that nobody knows whether they will be at risk from not asking.” The case involves NCPPR challenging a ruling by the SEC about a proposal not being included in Kroger’s proxy statement.
While the case doesn’t involve a crypto firm, it highlights the arbitrary nature of the SEC’s actions and decisions that the crypto industry is accustomed to. The SEC has continued to intensify its enforcement efforts without providing clarity on the rules and regulations that are to be followed.
In this instance, Alderoty remarked that the Judge made a fair point, as the legal expert looked to be relating the statement to the SEC’s lawsuit against Ripple. Before instituting its lawsuit against the crypto firm in 2020, the regulator hadn’t laid down any regulation that would have suggested that the XRP was a security.
Instead of laying down clear-cut rules that would have guided the crypto industry from the onset, the SEC chose to use Ripple to set an example of which it has failed woefully. The vagueness of the SEC’s rules is also why the court has had to rely largely on precedents while adjudicating crypto-related matters.
Ripple CLO Says SEC Keeps Cutting Corners
In an X post on March 5, Alderoty revealed how the SEC had told the Judge in its case against Binance that she should consider a decision from another court without disclosing it was a default judgment. This again highlights the Commission’s disregard for the court and willingness to act in bad faith just to secure victory.
The SEC also went as far as misrepresenting facts in the Debt Box case, which led the court to order the Commission to show cause why it should not be sanctioned for misleading the court. The regulator continues to act unhinged, which is why persons like Ripple’s co-founder Chris Larsen have clamoured for them to be held accountable for their actions.
Meanwhile, there is also a need for Congress to step in and formulate crypto-friendly laws so that the SEC can no longer act at its discretion while regulating the crypto industry.
