SEC Retreats from $50M Debt Box Lawsuit as Community Cries Foul Play

Ripple’s Chief Technology Officer and a prominent crypto lawyer are expressing dissatisfaction with the SEC’s approach to the Debt Box case, citing government overreach. The case, unraveling with revelations of false claims, has not only inflicted financial strain but also taken an emotional toll.

The SEC’s recent abandonment of a $50 million fraud lawsuit against Debt Box, coupled with admissions of making false statements, has left XRP Lawyers, led by John Deaton, critical of SEC Chairman Gary Gensler’s leadership.

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The SEC’s $50 Million Reversal

The SEC’s recent Motion to Dismiss charges against Debt Box has stirred controversy, with Federal judges, including Judge Torres, branding SEC lawyers as hypocrites in the Ripple lawsuit. This move has cast a shadow over the SEC’s legal arguments in other cases, raising suspicion within the legal community.

In an unexpected twist, an Appellate Court ruled the SEC’s denial of a spot Bitcoin ETF as arbitrary, leaving Deaton in disbelief. He accused the SEC of attempting to shield dishonest lawyers from repercussions despite being found guilty. Deaton suggested a ban on SEC lawyers appearing in cases presided over by the judge, intensifying the legal drama.

Also Read: Ripple’s Legal Head Exposes Flaws in Coinbase vs. SEC

What is the SEC Up To?

Prominent lawyers like Jeremy Hogan and Bill Morgan have questioned the SEC’s abrupt shifts in strategy, pointing out the agency’s insistence on a major fraud case, only to back off when faced with potential repercussions. The frustration among XRP lawyers is palpable, with accusations flying that the SEC is playing games in the courtroom.

Even Coinbase’s Chief Legal Officer, Paul Grewal, shook his head at the SEC, criticizing them for causing trouble and then trying to walk away without consequences.

It’s not just lawyers; Ripple’s CTO, David Schwartz, also called out the SEC for playing dirty in the Debt Box case.

Market Value Takes a Hit

Despite the SEC’s admission of error, the consequences were swift and severe, with a 56% drop in the market value of the associated coin.

But the message is bigger than just the technicalities. John Deaton emphasized that SEC lawyers must remember to deal with real lives and livelihoods. It’s not just about rules but about fairness and justice. This isn’t just a legal tussle; it’s a call for the SEC to be responsible and fair in handling crypto companies. People are watching and want fairness and justice, not just legal action.

Did You Know? Ripple CEO Halts IPO Plans in USA; “Hostile” SEC to Blame?!