More revelations continue to surface about the 2018 William Hinman documents.
There has been much controversy surrounding William Hinman’s 2018 speech that saw the SEC’s former Director of the Corporation of Finance declare Ethereum as a non-security.
The speech, which ended the neck-to-neck contest for which cryptocurrency would become the second-largest cryptocurrency between Ethereum and Ripple, made many believe that Hinman drafted that speech in favor of ETH due to his affiliation with the digital currency at the time.
According to a recent analysis by FOX Business journalist Eleanor Terrett, the 68 drafts of the speech were not reviewed by anyone but Jay Clayton, the former Chairman of the SEC.
Terrett noted that Clayton, who is believed to have close affiliations with Ethereum, made some input into the speech before Hinman made it public.
“Regarding @SECGov vs. @Ripple, I think I’m pretty much up to speed now. My biggest takeaways: The whole commission except Clayton was left off the 68 drafts of Hinman’s speech. @CGasparino and I reported that Clayton gave input on the speech before delivery,” Terrett said.
Interestingly, the SEC’s Ethics counsel who warned Hinman not to have any meeting with Simpson Thacher & Barlette while he was still Director of the Corporation Finance, was also not added to the email distribution list.
It is worth noting that despite the warnings from the ethics counsel, Hinman still went ahead and had a series of meetings with Simpson Thacher, a member of the Enterprise Ethereum Alliance (EEA).
The Big Question
Following Hinman’s close ties with the EEA, Terrett asked:
“As a member of a former (and future) firm with these ties, wouldn’t Hinman’s speech declaring Ethereum, not a security (and, subsequently, the price of ETH soaring) qualify him as ‘participating personally and substantially in a manner that would have a ‘direct and predictable effect’ on Simpson, Thacher & Bartlett?”
She added that if at all Hinman did not consider the implications before delivering the speech, someone at the Ethics department would have spotted the loophole unless they were not given access to review the speech.
“It will be interesting to see if the SEC responds to @EMPOWR_us request for an investigation into its ethics officials,” Terrett concluded.
Reacting to the development, attorney John Deaton, a lawyer representing 65,000 XRP holders in the ongoing lawsuit between the SEC and Ripple applauded the FOX journalist for the important question raised, saying:
A young @FoxBusiness journalist seems to be doing the job and asking the relevant and important questions that the more senior journalists at @CNBC refuse to cover. @BeckyQuick @andrewrsorkin @JoeSquawk did you guys know Clayton was the ONLY commissioner to review the speech? https://t.co/voeLRVF4yx
— John E Deaton (@JohnEDeaton1) May 15, 2022
Meanwhile, the Securities and Exchange Commission is doing everything within its power to prevent Hinman’s documents from being used as evidence in the ongoing lawsuit despite the court’s orders.