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Ripple chief legal officer Stuart Alderoty said the approval of spot Bitcoin ETF in the United States became possible only because of the U.S. Securities and exchange commission’s (SEC) setbacks in court. He remarked that the SEC was an ‘out of control regulator.’
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Bitcoin ETF: Enforced By Courts
Alderoty recalled that the ETF approval was a result of legal enforcement from court cases in which the agency lost. In the Grayscale lawsuit, the a US Court of Appeals for the District of Columbia Circuit judge remarked in a ruling on August 29, 2023 that the SEC officials acted in an arbitrary and capricious manner when it denied the conversion of the Grayscale Bitcoin Trust (GBTC) into an exchange traded fund (ETF). The company had argued that the US SEC was being impartial when compared to the terms under which the bitcoin futures ETF applications were approved.
SEC Continuing To Harm Reputation: Commissioner
The Ripple legal chief reiterated the statement made by SEC Commissioner Hester Peirce on the occasion of the Bitcoin ETF approval. The Commissioner said that the SEC, with its regulatory enforcement against crypto, had driven retail investors to “less efficient means of attaining bitcoin exposure”. She added,
“Our arbitrary and capricious treatment of applications in this area will continue to harm our reputation far beyond crypto.”
Further, she explained that the SEC’s actions have alienated a generation of product innovators in the space. The SEC’s unreasonable approach to these applications has signaled an regulatory prejudice against new products and services.
This is particularly true in the case of Ripple, which had been actively operational outside of the US since the SEC filed the Ripple lawsuit in December 2020 claiming that the sale of XRP tokens amounted to illegal sale of securities. Earlier in 2023, the agency received its biggest setback in the recent years when judge Analisa Torres ruled that the XRP token sales to retail buyers were not in fact securities.
Also Read: Spot Bitcoin ETF Approved: Here’s Why Grayscale is the Biggest Winner
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