Ripple CEO Highlights Cost of Fighting the SEC, Says Company Will Spend Over $100 Million in Legal Fees.
Brad Garlinghouse, CEO of Ripple, has disclosed the financial cost of engaging with the Securities and Exchange Commission (SEC) in a lawsuit.
In a recent interview, Garlinghouse noted that by the end of the lawsuit, Ripple will have spent over $100 million in legal fees.
“The facts and Law are on the side…When this is all set and done, we will have spent over $100 million on legal fees fighting the SEC… This fight is not just for Ripple; it’s for the whole Industry,” Garlinghouse said at Consensus 2022 in Austin Texas.
"When this is all set and done, we will have spent over $100 million on legal fees fighting the SEC," @Ripple CEO @bgarlinghouse said at #Consensus2022.
Watch the full conversation on why he chose to fight the @SECGov: https://t.co/ktYPgXVT5R pic.twitter.com/jcOiuIKr9N
— CoinDesk (@CoinDesk) July 15, 2022
Garlinghouse: SEC Bully Crypto Firms Into Settlement
According to the Ripple CEO, the massive cost of engaging the SEC in a legal battle has always been in favor of the securities regulator. Garlinghouse said the Securities and Exchange Commission relies on the fact that most crypto-related companies cannot afford to challenge the agency in a lawsuit. Thus, consistently bullying these firms into a settlement, he added.
“The dynamics there is that the SEC bullies companies into settlement because they cannot afford to fight,” Garlinghouse said in the interview.
Ripple Paying the Ultimate Price for Crypto
The Ripple CEO also shared insights on why Ripple chose to embark on the lawsuit rather than opt for a settlement like most crypto firms would have done. For Garlinghouse, the ongoing legal battle is essential for the entire cryptocurrency industry, not just Ripple.
Ripple chose to fight the SEC to force the Securities and Exchange Commission to provide regulatory clarity for the nascent industry.
He talks about the SEC’s approach to regulating the nascent industry, which has been heavily scrutinized in recent times. Garlinghouse referred to the 2018 Bill Hinman speech, where Ethereum (ETH) was declared a non-security.
He noted that industry players thought the SEC would eventually provide regulatory clarity for crypto at the time. However, that has not been the case four years since the speech was made, as there has not been any more precise regulation for the industry.
“The SEC current Chair Gary Gensler is walking back the [Hinman] statement around ETH. He’s been asked directly if ETH is a security and he won’t answer the question,” Garlinghouse added.
The Importance of Ripple-SEC Lawsuit to Crypto
The SEC v Ripple ongoing legal battle is considered the biggest lawsuit that has ever happened in the crypto space and it is widely observed by many.
A win for Ripple would compel the SEC to provide clearer regulations for the cryptocurrency industry. However, if Ripple loses the lawsuit, the SEC will continue its clampdown on crypto companies, prompting them to opt for a settlement rather than engage in a legal battle.