Ripple Alderoty Berates SEC Enforcer For Praising Agency Actions

Ripple Chief Legal Officer (CLO) Stuart Alderoty recently lashed out at Gubir Grewal, the SEC's top enforcer and director. The CLO reacted to Grewal's recent comments regarding the crypto industry.

The SEC Director criticized the crypto industry for non-compliance with regulations on Wednesday, April 3. He tore down the industry during a two-day SEC Speaks" event by the Practicing Law Institute.

SEC Director Criticizes Crypto Industry for Non-Compliance

During the event, the director gave a fifteen-minute speech sharing his opinion about the crypto industry and regulation. According to the SEC executive, the crypto industry takes actions to evade the agency's regulatory measures.

He said the industry devises;

creative attempts to avoid the regulator's jurisdictions."

Further, he dispersed that the SEC focuses on enforcement action within the industry instead of ensuring clarity in its rules.Regarding asset classification, the SEC director reiterated that the Howey Test is the only approach to determining an asset's status as a security.

Additionally, Grewal defended the securities regulator as consistently applying the test.He also implied that the SEC's assessment method is unambiguous in determining which assetsare securities.

Further, the SEC director noted that the agency has recently faced several allegations from crypto fans.According to him, these are part of the industry's gimmicks to twist the regulator and get different regulatory standards.

In summary, Grewal stated that the SEC has maintained an upright approach to its activities and retained its integrity against all odds.He also emphasized that the agency will remain consistent with its rules without compromise.

Ripple's CLO Calls Out SEC Enforcer Over His Speech

Ripple CLO Stuart Alderoty called out the SEC enforcer Grewal over his speech. He criticized the SEC executive for claiming that the agency acts with integrity.

Alderoty maintained that the SEC oversteps its regulatory jurisdiction in its operations and doesn't act in good faith. The CLO cited some crypto cases where federal court judges cautioned the agency for such acts.

Further, the CLO highlighted instances where the SEC displayed its gross abuse of power" and lack of faithful allegiance to the law." These include the DebtBox and Ripple cases.

Further, Alderoty touted the SEC regarding the court's statement of its actions as arbitrary and capricious" in the Grayscale lawsuit.

On the substance, he cites one portion of the Ripple ruling but ignores that the SEC lost or gave up on most of its claims in the case, including the Court's rejection of the SEC's assertion that XRP was in and of itself a security.

- Stuart Alderoty (@s_alderoty) April 3, 2024

Moreover, Ripple's executive challenged Grewal's claim that the SEC offers guidance to the crypto industry.The CLO pointed out that the supposed guidance, as indicated on the agency's website, reflects an arbitrary adjustment of the Howey test factors.

Alderoty believes the SEC's changes on the Howey test supported issuing a more confused statement from the commission's former General Counsel. Further, the CLO brought up the SEC vs. Ripple case, pointing out the biased nature of the SEC to Grewal.

Alderoty maintained SEC only accepted the part of the court's ruling where it won. However, it disregards the declaration that XRP and its retail sales on exchanges are non-secure.

Also, the CLO pointed out how the SEC dropped parts of its case against the blockchain payment firm. This includes the regulator's charges against Ripple's CEO and Chairman.

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