Ripple’s CEO Condemn SEC stans on XRP in the ongoing Bitnomial Case

Brad Garling, Ripples’ CEO recently voiced his criticism towards the US Security Exchange Commission (SEC) stance on XRP as Security, even though a US court has declared otherwise. This is a result of the ongoing legal battle between Bitnomial (a derivative crypto exchange) and SEC on its classification and regulation of XRP derivatives.

Another Ripple’s Battle with SEC

Ripple, the blockchain company behind the XRP token, has been in a long legal battle with the SEC. The battle revolves around the classification of XRP, whether the token is a security or not. In finance, a security is a type of financial asset representing an investment in a company. If XRP, which is a cryptocurrency, is considered a security, its issuing and usage has to follow rules and regulations from the SEC. Although previous court rulings declared XRP is not a security, the SEC still persists in treating the token as one, claiming it falls under its regulatory jurisdiction.

Ripple’s Response to SEC

Brad, Ripple’s CEO showed his annoyance toward the SEC refusal to acknowledge XRP isn’t a security, even after court ruling. He condemned the financial regulatory body via X (formally known as Twitter), claiming the agency is acting like it is above the law. His statement suggest He strongly believes the government agency is overstepping its boundary. 

Furthermore, Stuart Alderoty, Ripple’s CLO (Chief Legal Officer) also expressed his frustration towards the SEC — this raises concerns and questions about a government regulatory body ignoring court decisions. Stuart defines the SEC behavior towards crypto, particularly, Ripple Labs as “unconstitutional aggression.” He believes a regulatory body refusing to acknowledge the law through court judgements is killing trust in fairness of the legal system.

The Bitnomial Court Case

The back and forth between the SEC and Ripple has also affected Bitnomial, a crypto exchange platform which trades XRP derivatives. The Bitnomial court case centers around which financial regulatory body should regulate the platform due to its XRP derivatives — should it be the Commodity Futures Trading Commission (CFTC) or SEC?

In the ongoing court case, The crypto exchange claimed the SEC is unnecessarily burdening its existence by insisting the platform register with the national securities exchange. Bitnomial believes the company should be regulated by CFTC, since the court has previously declared XRP token not a security. This current Bitnomial court case is among the events causing a lot of debates in the US on how digital assets should be regulated.

Crypto Community and Legal Experts Reactions

The crypto community and a lot of legal experts have expressed their disappointment with the US SEC recent actions against Bitnomial. A lot of them argue that the SEC is not only acting beyond its jurisdiction, but also ignoring and disrespecting the court’s judgment. For instance, Bill Morgan, one of the Pro-XRP lawyers, accused the SEC of misusing its power — this is as a result of the agency’s continuous classification of XRP as a security. 

Another notable legal figure is John Deaton, a lawyer well known for representing XRP holders during Ripple’s legal battle against SEC. John described SEC action as “arbitrary and capricious,” a legal term used to describe an agency acting without any justifiable reason. He went on to point out SEC continuous unjustifiable actions against crypto entities by referencing the agency’s legal battle with another crypto platform, Digital Licensing. In the legal case, the SEC was served a legal punch, as the agency was penalized for misconduct against the crypto platform. 

 Concerns About Regulatory Overreach

The SEC action in the ongoing legal battle with Bitnomial has raised concerns about the agency’s motive in regulating cryptocurrency. A large percentage of the crypto community are of the opinion that the SEC is trying to gain control of the crypto industry by all means — even when court judgment is against its stance. Furthermore, some critics believe the regulatory body’s continuous efforts in classifying XRP as a security is part of its attempt in gaining regulatory power over digital assets. This further adds doubt to the integrity and real motive of the agency’s towards the crypto industry.

The legal battle between Bitnomial and the SEC shows a wider tussle between cryptocurrency and financial regulatory bodies in the US. Therefore, the outcome of this legal battle will have a big impact on the future of cryptocurrency in the country. If Bitnomial wins, SEC might lose its strong grip on cryptocurrency, leading to a big shift on how cryptocurrency will be regulated in the country.