Brad Garlinghouse – CEO of Ripple – said the fintech company was making “fairly satisfactory progress” in its legal battle with the United States Securities and Exchange Commission (SEC). He hopes to reach a conclusion in 2022.
Ripple Takes The Upper Hand
In an interview for CNBC, Brad Garlinghouse opined that the legal lawsuit versus the SEC is going in favor of Ripple. However, the case is unlikely to be resolved by the end of 2021 due to its specifics:
“We’re seeing pretty good progress despite a slow-moving judicial process.”
According to the CEO, the judge in charge of the case has addressed “good questions” because he “realizes that it is not just about Ripple” because the outcome of the legal battle will have a wider impact.
Given that the blockchain payment company is the issuer of XRP, the SEC accused the firm of selling $1.3 billion worth of the token in an unregistered securities offering at the end of 2020.
In its defense, the company said XRP should not be considered a security – a classification that subjects it to further regulatory scrutiny. Furthermore, Garlinghouse opined that the inability of US authorities to implement comprehensive rules in the crypto space is “frustrating.” He even criticized the country’s securities regulator for being the only global agency to insist that the XRP token is indeed a security.
The SEC-Ripple War
Following several accusations from both sides since the start of the legal case, the battle took a turn this August when Ripple defendants fired back with a motion to expose the XRP holdings of SEC employees. The lawyers also wanted to collect “anonymized documents reflecting [the SEC’s] trade preclearance decisions involving XRP, bitcoin and ether.
Within their motion, Ripple demonstrated that the regulator had “not adopted or imposed” any rules restricting their employees from trading in crypto until January 16, 2018. This would, according to the company, be in line with previous views of the Commission on Digital Assets. not being securities until then:
“At all times from 2013 until at least January 19, 2018, SEC employees were free to buy, sell and hold XRP without any restriction by the SEC.”
The Commission scored a point days later by gaining access to Ripple’s missing internal Slack messages. Before that, the company refused to hand over a substantial part of the communications citing a processing error as a reason.
According to the SEC, these messages contain “discussions of Ripple’s desire to create speculative XRP exchanges.”
