Ripple CEO Slams SEC, Warns Ethereum Battle Threatens USA Crypto Dominance

Is the SEC overstepping its bounds in the crypto space?

Ripple CEO Brad Garlinghouse reignites the regulatory debate, criticizing the SEC’s approach to Ethereum (ETH) and warning of unintended consequences. With the SEC fresh off a legal battle with Ripple over XRP, Garlinghouse’s comments raise questions about the future of cryptocurrency regulation in the US.

Will the SEC score another win, or is it headed for another courtroom clash? Read on to find out.

Bashing the SEC

Garlinghouse didn’t shy away from pointing out the SEC’s difficulties, from courtroom setbacks to regulatory conflicts with counterparts like the Commodity Futures Trading Commission (CFTC), painting a picture of the SEC lagging behind its international peers.

In a recent tweet, Garlinghouse criticized the SEC’s aggressive posture towards Ethereum and other industry players. He noted that recent judicial rulings have dealt heavy blows to the commission’s position.

Also Read: Ripple vs SEC: New Timeline Set for Confidential Filings

Ethereum in the Crosshairs

Garlinghouse’s tweet emerged amidst the SEC’s latest offensive to reclassify Ethereum as a security. This move was underlined by subpoenas issued to U.S. companies, part of a broader investigation into the asset. The demand for “documents and financial records” from the Ethereum Foundation, based in Switzerland, further emphasized the SEC’s uncompromising stance.

Drawing parallels to Ripple’s legal victory over the SEC in the XRP case, Garlinghouse warned that if the SEC fails to adjust to the Ethereum approach, it could undermine its authority and credibility with regard to cryptocurrencies systematically.

So, What is Ethereum Exactly?

Ongoing investigation highlights the long-standing debate over Ether’s status as a security. If declared as such, Ether (ETH) would fall under SEC jurisdiction, a prospect that has sparked resistance within the industry.

This development threatens the SEC’s desire to approve spot Ethereum ETFs this year. Despite the approval of 11 spot bitcoin ETFs in January, the SEC’s current regulatory action casts doubt on Ethereum’s prospects.

Conflict with Fellow Regulators

Garlinghouse also shed light on the growing role of the SEC’s and other regulators, particularly the Commodity Futures Trading Commission (CFTC). This increase raises concerns about legal clarity and order in the financial system.

Additionally, Garlinghouse warned that the SEC’s tough stance could slow down innovation and investment in the US, potentially undermining its global competitiveness.