Key Takeaways
- Ripple CEO Brad Garlinghouse predicts that the SEC will lose its legal battle against Ethereum, similar to how the regulatory agency lost the case regarding XRP.
- Industry leaders, including Paul Grewal from Coinbase, have criticized the SEC’s efforts to classify Ethereum as a security and questioned the inconsistency of the agency’s regulations.
- Ripple’s Chief Legal Officer has called for Congress to reevaluate the SEC’s approach, suggesting that the current regulatory stance is ineffective and could hinder progress in the crypto industry.
Ripple CEO Brad Garlinghouse recently predicted that the Securities and Exchange Commission’s (SEC) investigation into classifying Ethereum as a security will likely fail. This prediction comes after recent reports of the securities regulator’s campaign efforts to classify Ethereum as a security due to the pending decisions on Ethereum spot exchange-traded funds (ETF).
Garlinghouse: SEC Will Lose Against Ethereum
Garlinghouse compared the SEC’s current scrutiny of Ethereum to the lawsuit against XRP. In the Ripple case, the SEC argued that XRP functioned as a security and should have been registered with the Commission. However, Judge Analisa Torres ruled on July 2023 that the XRP token itself does not meet the standards set of being a security.
Furthermore, Garlinghouse stressed that the SEC’s past lawsuits with the crypto industry suggest the regulator may face difficulties in its current investigation of Ethereum.
Coinbase’s Paul Grewal: SEC Has No Valid Reasons To Deny Spot Ethereum ETFs
In an X post, Coinbase’s Chief Legal Officer, Paul Grewal, highlighted Ethereum’s (ETH) status as a commodity, not a security. He cited past statements from SEC officials, including current Chair Gary Gensler, who previously characterized Ethereum as a commodity.
He cited various documents, including a 2018 testimony in which Gensler, then a senior lecturer at the MIT Sloan School of Management, affirmed before Congress that Ethereum does not qualify as a security.
Grewal has called for Congress to reevaluate the SEC’s approach, suggesting that the current regulatory stance is ineffective and could hinder progress in the crypto industry.
