- Crypto Twitter faced a false rumor of SEC Chairman Gary Gensler resigning from the regulatory agency.
- Pro-XRP attorney John Deaton said that Gensler’s resignation is possible in the near future.
- XRP price climbed over the weekend, sustaining above $0.4810.
John Deaton, a pro-XRP attorney, addressed the rumors of Securities & Exchange Commission (SEC) Chairman Gary Gensler’s resignation from the agency. While word of Gensler’s resignation is just a rumor which turned to be false, Deaton says there is a likelihood that the SEC Chair resigns soon for political reasons.
The SEC Chair has drawn criticism from crypto market participants, exchange platforms and legal teams defending firms against the financial regulator’s allegations. Binance’s Changpeng Zhao (CZ), Coinbase executives, or Ripple’s CEO Brad Garlinghouse have all criticized the SEC’s recent approach, which they call “regulation by enforcement”.
Also read: Shiba Inu resists selling pressure from sale of 94 billion SHIB tokens by Poly Network hackers
Attorney John Deaton says Gary Gensler could resign for this reason
Attorney John Deaton, an amicus or “friend of the court” in the SEC vs. Ripple lawsuit, believes that SEC Chair Gary Gensler could resign soon. Deaton commented on a widespread rumor on crypto Twitter regarding the agency Chair’s status.
Not yet. But we are entering the election year season and the more of a political liability @GaryGensler becomes the greater chance it does happen. https://t.co/eeCGGJbGJj
— John E Deaton (@JohnEDeaton1) July 3, 2023
Deaton’s argument is that the upcoming political campaign could see Gensler’s resignation from the SEC after the agency’s crackdown on cryptocurrency exchanges and projects in the ecosystem. The SEC has been embroiled in a legal battle with Ripple for over two years now.
The financial regulator recently filed lawsuits against Binance and Coinbase, two of the largest exchanges in the crypto ecosystem. In the lawsuit, the regulator labeled nearly five dozen cryptocurrencies being traded on their platforms as “securities”, which would mean that the exchanges were allowing the trading of unregistered securities – a serious offense.
The SEC’s communication team denied the rumor over Gensler’s resignation, Fox business network Charles Gasparino said in a tweet.
Breaking: As expected @SECGov PR says @GaryGensler is not resigning
— Charles Gasparino (@CGasparino) July 2, 2023
It was confirmed that the resignation rumor, which had been spreading over the weekend, is speculation.
What Gensler’s resignation would mean for crypto
Gensler was nominated by US President Joe Biden to serve as Chairman of the US financial regulatory agency SEC, and took office on April 17, 2021. Since then, Gensler has directed and shaped the agency’s approach towards cryptocurrencies, calling for regulation of a sector he described as the “wild wild west.”
In a recent CNBC interview, former SEC Chairman Jay Clayton expressed his discontentment with Gensler’s approach towards cryptocurrencies. Clayton considers Gensler’s approach as one that is likely stifling businesses in the US and shifting the public’s perception of the regulatory agency’s role in the ecosystem.
Gensler’s resignation could open doors to a different approach towards US-based crypto companies and projects and serve the interests of innovation in the blockchain and crypto sector overall.
SEC vs. Ripple lawsuit update
XRP holders await judgment in the SEC vs. Ripple case. Judge Analisa Torres’ summary judgment in the lawsuit is expected to arrive by September, according to Ripple Labs CEO Brad Garlinghouse. Attorney Fred Rispoli, a pro-XRP lawyer, has predicted a ruling in the SEC vs. Ripple lawsuit by August 10. Rispoli deduced this from the statistics of previous summary judgements by Judge Torres.
The altcoin has sustained above the $0.4810 level at the time of writing on Monday. XRP holders are waiting and watching the development of the lawsuit and Ripple’s next steps, while the altcoin continues its hopeful, upward trend.
SEC vs Ripple lawsuit FAQs
Why are the US Securities and Exchange Commission and Ripple litigating?
The United States Securities and Exchange Commission (SEC) brought charges against Ripple and its executives alleging that the cross-border payment settlement firm raised more than $1.3 billion through an unregistered asset offering of the XRP token. Ripple argues that XRP should not be treated as a security or an investment contract, just like the SEC looks at Bitcoin or Ethereum, citing views from former SEC Director of Corporation Finance William Hinman.
When did the SEC vs. Ripple court case start?
The SEC charges were made public in December 2020. The long-running litigation, presided by Judge Analisa Torres, seems to be close to its end as both parties fail to reach an agreement.
What are the effects on XRP price?
Ripple is the largest holder of the altcoin XRP. The SEC’s charges against Ripple resulted in a mass delisting of XRP across crypto exchange platforms and a sharp decline in the token’s value, which used to be the third crypto asset by market capitalization after Bitcoin and Ethereum. A positive outcome for Ripple in its case against the SEC would benefit XRP’s price, while a SEC win is likely to weigh further on the asset, experts say.
Which implications could the ruling have on the overall crypto industry?
The final verdict in the SEC vs. Ripple lawsuit is the most highly anticipated in the crypto ecosystem. The lawsuit is expected to set precedent for other open cases that affect dozens of digital assets. A ruling in favor of the SEC would most likely bring further regulation to the sector as it would classify most tokens as securities. On the contrary, Ripple’s win would be interpreted as a validation of the crypto markets and could boost investors' confidence if current legal uncertainties surrounding digital assets in the US are solved.
What about secondary sales of XRP among traders?
The ruling may also include views over XRP secondary sales, which directly affects investors who trade XRP on cryptocurrency exchange platforms. Pro-Ripple attorney John Deaton, who filed an amicus brief in the SEC vs. Ripple case, suggests this matter is likely to be addressed. A ruling stating that secondary sales don't qualify as securities, contrary to what the SEC claims, is likely to be beneficial for XRP.
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