Ripple CEO Brad Garlinghouse accuses the Gary Gensler-led SEC of hypocrisy, indicating that the commission does not consistently apply its so-called clear rules.
Garlinghouse’s commentary follows the SEC’s decision to retract its request seeking a court’s declaration that certain third-party tokens on Binance constitute securities. The SEC specifically mentioned ten tokens as securities in its lawsuit against the leading crypto exchange Binance.
They include Axie Infinity (AXS), The Sandbox (SAND), Cardano (ADA), Solana (SOL), Decentraland (MANA), Polygon (MATIC), Binance USD (BUSD), Binance Coin (BNB), Coti (COTI) and Cosmos (ATOM).
However, in the latest development, the SEC suggested that it no longer seeks a ruling to classify the tokens as securities.
Ripple CEO Reacts, Calls Out SEC Hypocrisy
The sudden U-turn elicited mixed reactions from crypto community members, including Ripple CEO Brad Garlinghouse. Notably, Garlinghouse said the SEC’s recent decision in the Binance case is further evidence of the commission’s hypocrisy.
The Ripple CEO slammed the SEC boss, expressing frustration with his inconsistent application of crypto regulations. According to Garlinghouse, under Gensler’s leadership, the SEC is causing greater confusion across the industry by not consistently applying his so-called clear rules.
He argued that the SEC’s recent decision was not driven by a faithful allegiance to the law but stemmed from a political agenda or bad faith litigation tactic.
Inconsistent Litigation Strategy
It is worth noting that the SEC classified 68 crypto assets as securities, XRP. The regulatory agency labeled the tokens securities in different lawsuits, including the Ripple and Coinbase cases.
This marks the first time the SEC retracted its request for a court not to classify crypto tokens as securities. Notably, the SEC did not give XRP a similar courtesy. The commission wanted a New York federal court to declare XRP a security. However, the court declined, emphasizing that XRP is not in itself a security.
The SEC’s decision in the Binance lawsuit was surprising, considering its vision to become the appropriate crypto regulator. This has driven the SEC to give the securities tag to multiple cryptos to bring them under its regulatory purview.
Meanwhile, crypto enthusiasts believe the SEC’s recent action is part of a bigger plan to attract crypto voters into supporting the Democratic Party in the upcoming U.S. elections.
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