The chief executive of Ripple Labs, Brad Garlinghouse, has alleged that the U.S. Securities and Exchange Commission (SEC) has inconsistently implemented restrictions on the nation’s crypto firms.
“The SEC, instead of doing the hard work to define a new set of clear rules, a new set of clear regulations […] they instead decide we’re going to do regulation through enforcement, which is not efficient and really I think has stifled innovation in the United States,” he said.
Brad Garlinghouse calls out SEC’s approval of Coinbase
Garlinghouse spoke to Wired’s editor-in-chief Thursday at the Collision conference in Toronto. He explained that Ripple is fighting the SEC in court, where the agency claims the company’s executives ran an “unregistered, ongoing digital asset securities offering” with XRP token sales.
The CEO mentioned the SEC’s authorization of Coinbase’s initial public offering in April 2021, even though the crypto exchange at the time listed XRP.
“The SEC now seems to take the position when they sued us that ‘XRP is a security and always has been,’ but they approved Coinbase going public even though Coinbase is not a registered broker-dealer,” the Ripple CEO said.
Ripple goes after SEC
Before and after the SEC filed its case against the company in December 2020, Garlinghouse, Chris Larsen, the co-founder of Ripple, and David Schwartz, the company’s chief technology officer, all went after the American regulator.
Given various authorities’ approaches to “regulation through enforcement,” Larsen stated in October 2020 that Ripple should think about leaving the U.S. behind. The company is now based in San Franicsco, although it also has offices in Dubai and Wyoming.
Many anticipate that the outcome of the ongoing legal dispute between Ripple and the SEC will establish a precedent for how cryptocurrencies are regulated in the U.S.