Ripple CLO Spots Loophole In SEC’s Stance On Crypto Regulation

As Ripple and Coinbase’s legal battle against the U.S. Securities and Exchange Commission (SEC) escalated, the country’s regulators made conflicting statements on crypto. Ripple’s Chief Legal Officer, Stuart Alderoty, has recently spotlighted the contradictory positions of the SEC and Treasury Secretary Janet Yellen on crypto regulation.

Ripple CLO Highlights Ambiguity On Crypto Regulation

The Ripple CLO recently took to X and noted that the SEC referred to crypto as a “rounding error” in the Coinbase case. In addition, the SEC stated that no legislative gaps exist and it can be easily “swept” into its authority. Moreover, in a recent statement, Treasury Secretary Yellen emphasized the necessity for legislation to address regulatory gaps.

In Coinbase, the SEC told the judge that crypto is a “rounding error,” no legislative gaps exist and thus, crypto can be “swept” into its authority. Yesterday, Sec. Yellen told Congress crypto legislation is needed to fill regulatory gaps. Both statements can’t both be true. pic.twitter.com/RcMF42Rro1

— Stuart Alderoty (@s_alderoty) February 7, 2024

Ripple’s CLO took both these statements into consideration and highlighted the ambiguity of crypto regulation in the country. He noted that “both statements can’t be true,” emphasizing the need for a clearer picture. In addition, his view underscored the need for uniformity in the U.S. regulators’ statements and actions concerning the crypto domain.

These contradictory statements could indeed be helpful for both Ripple and Coinbase in combating the SEC in the court. The companies might leverage these statements to their advantage to highlight that when there is no legal clarity on crypto, these lawsuits aren’t fair. Hence, the regulators should first focus on coming up with a uniform statement.

Also Read: Regulatory Paralysis: Yellen’s Latest Alarm Highlights Stalled US Crypto Framework

Coinbase Faces Heat Over SGB Controversy

Amid the legal quandary, Coinbase faced heat from lawyers highlighting the Songbird (SGB) crypto controversy. In a post on X, Fred Rispoli, a lawyer at HODL Law firm, slammed Coinbase for “converting customer property into its possession and control, like when the company did that with customers’ $SGB.” He added that they do so “because Coinbase and its executives will take from you whatever they can get away with.”

In the replies section, the lawyer also noted that HODL Law is engaged in active litigation against Coinbase. Moreover, the lawyer is also following the Ripple vs SEC case closely. While he supports Ripple and suggests ways it could have escaped the SEC’s clutches, he expresses resentment toward Coinbase.

On the other hand, lawyer Bill Morgan, who also provides timely insights on the Ripple vs SEC lawsuit, quoted Rispoli’s tweet and condemned Coinbase due to the SGB controversy. He stated that Coinbase is attracting “sympathy” as it never agreed to participate in the SGB snapshot.”

However, Morgan believes that this doesn’t give them the right to keep or sell SGB tokens not intended for them. Concluding his statement, he wrote, “If I was bringing such a claim in Australia I would consider a claim based on equitable principles of unjust enrichment.”

Also Read: XRP Price Prediction: Can XRP Reach $1 After Winning SEC Case And Aim For $10?