Ripple CEO Brad Garlinghouse recently informed guests of the Paris Blockchain Week that the company’s fight against a lawsuit from the Securities and Exchange Commission (SEC) is proceeding quite well.
Ripple CEO Brad Garlinghouse is hopeful that the company’s long-running case with the SEC will end in a favourable outcome. Garlinghouse highlighted that Ripple’s defence in the current dispute was progressing better than expected:
“The lawsuit has gone exceedingly well and much better than I could have hoped when it began about 15 months ago.”
Live from #PBWS2022, @bgarlinghouse sat down with @cnbc‘s @ryan_browne_ to talk crypto regulation, Ripple’s global traction and use cases that he sees growing across the industry. pic.twitter.com/ouQYhY3B5n
— Ripple (@Ripple) April 14, 2022
The SEC filed a lawsuit against Ripple and two of its top executives in 2020 for marketing unregistered securities in the form of XRP.
Ripple had gained a “very big win” against the SEC after Presiding Judge Sarah Netburn dismissed the SEC’s request to shield documents under privilege. The papers were related to a speech by former SEC Director William Hinman in which he said that Bitcoin (BTC) and Ether (ETH) are not securities.
Garlinghouse said that this lawsuit is critical, not just for Ripple but for the whole cryptocurrency business in the United States.
He noted that if Ripple loses the lawsuit, a precedent might be created for the SEC to classify most tokens traded on cryptocurrency exchanges as “securities.”
This would require exchanges to register as brokers with the SEC and record all token holders’ identities.
“If you determine XRP as a security of Ripple, we have to know every person that owns XRP,” he said. “That’s an SEC requirement. You have to know all of your shareholders. It’s not possible.”
However, if Ripple wins convincingly, the SEC may reconsider its aggressive pursuit of the crypto sector.