The CEO of Ripple released an official video on the Hinman emails, highlighting the perceived hypocrisy from the SEC and alleging that they are looking to kill crypto in the U.S.
Brad Garlinghouse, the CEO of Ripple, has released an official video addressing the content of the recently-unsealed documents on the infamous June 2018 speech from Bill Hinman. Garlinghouse highlighted the SEC’s perceived hypocrisy and alleged that the agency is looking to kill crypto innovation in the U.S.
“A few days ago, after two years, seven court orders, and over $100 million in legal bills, the Hinman speech documents, including internal SEC emails and comments leading up to this now-infamous 2018 speech, they’ve finally been unsealed,” Garlinghouse pointed out in a video released on Twitter.
Trying something new – some thoughts from me on the events (specifically the release of the Hinman documents) of this week. For me, this has all had a personal bent to it – and felt like it warranted some personal comments. pic.twitter.com/k4dYeQGhsN
— Brad Garlinghouse (@bgarlinghouse) June 16, 2023
Hinman Tried to Create New Laws
The Ripple CEO stresses that Hinman’s speech created new factors for determining if an asset is a security. As previously mentioned by The Crypto Basic, Hinman noted that an asset could no longer be considered a security if it is “sufficiently decentralized.”
Garlinghouse pointed out that, as the documents reveal, most of the officials at the SEC disagreed with Hinman’s proposed laws. They warned that the new factors could confuse the public more, but Hinman ignored these warnings.
Garlinghouse remarked: “At worse, they (the documents) show that Hinman deliberately ignored the law. And he tried to create new laws, something only Congress can do. And while he was a public servant, Hinman received millions of dollars of payments from his law firm, which was part of an alliance with others that had invested interest in this speech.”
The Ripple CEO emphasized that the speech is not mainly against one token but represents the SEC’s relentless enforcement actions against crypto industry leaders. He says the agency does this while “professing fake open arms.” Several key players in the crypto industry have also highlighted this issue, including Coinbase.
Ripple Spent Years Engaging the SEC for Clarity
Garlinghouse stressed that the SEC’s enforcement actions persist while the regulatory watchdog “lies about their so-called guidance.”
He revealed that Ripple spent years engaging the SEC regarding clarity. He disclosed that he met with Jay Clayton, the then SEC Chairperson, and Bill Hinman. Garlinghouse said this meeting had no lawyers present because he believed they were all “coming together in good faith.”
Garlinghouse noted that Ripple answered every question the SEC had, and the agency never suggested that XRP was a security. “We were fully transparent, not knowing they would then use this information against us,” he added.
After these engagements, he confirmed that the SEC sent them a surprise Wells notice, revealing plans to sue them for breaking securities laws. However, Garlinghouse stressed that the agency still refused to provide any specific guidance.
Garlinghouse mentioned further: “To those that have recently been hit with their own Wells notices and lawsuits, this likely sounds all too familiar.”
Notably, crypto entities such as American exchange Coinbase and New York-based financial institution Paxos also received Wells notices from the SEC. The SEC sued Coinbase this month, shortly after it leveled charges against Binance.
“The SEC is Looking to Kill Crypto Innovation”
Garlinghouse noted that when the SEC’s lawsuit eventually dropped against them, the agency made it personal by suing him and Chris Larson, Ripple’s co-founder and Executive Chairman.
According to Garlinghouse, the agency alleged that he and Larson should have known that XRP was a security. However, with the release of Hinman documents, the public can now see that even the SEC could not agree among themselves what a security is. “To me, it still seems like they can’t,” Garlinghouse noted.
He stressed that what Ripple witnessed in their case is “exactly” what the entire crypto industry is currently facing.
Garlinghouse commented: “The SEC is looking to kill crypto innovation in the United States, and its current Chair, an unelected bureaucrat, I might add, is weaponizing the lack of regulatory clarity to exert jurisdiction over the entire crypto space. This is the definition of putting politics over people.”
Ripple CEO Thanks XRP Community
According to the Ripple CEO, the SEC’s actions represent a case of pursuing power at the expense of sound policy. He alleged that the SEC attempted to bully them into conforming, but they had the resources to fight back.
“Now we can all see what they fought so hard to hide: they knowingly create confusion about the rules, and they use that confusion to regulate through enforcement. That’s bad faith,” he added.
Garlinghouse expressed gratitude to his family, friends, and the XRP community for their unwavering support throughout the multi-year lawsuit. He noted that the case is ending, but for so many others, such as Binance and Coinbase, theirs are just starting. He asked these entities to continue the fight for clarity.