Ripple CEO Calls Out SEC for Enforcement Tactics

Ripple executives have openly criticized the U.S. Securities and Exchange Commission (SEC) as legal battles over the XRP token continue. Ripple CEO Brad Garlinghouse called out SEC Chairman Gary Gensler for pursuing what he described as a “regulation by enforcement” strategy. Gensler, whose tenure as chairman ends on January 20, has been a key player in the SEC’s efforts to regulate the cryptocurrency sector.

Garlinghouse argued that the SEC’s aggressive stance disregards broader public concerns and the potential implications of the upcoming 2024 elections. He emphasized that this approach does little to provide clarity for the cryptocurrency industry or its participants.

Ripple’s Chief Legal Officer, Stuart Alderoty, also weighed in, criticizing the SEC for denying Ripple’s request to delay filing its appeal brief, which is due on January 15. Alderoty described the SEC’s decision as unnecessary but reiterated Ripple’s confidence in its legal defense. He expressed hope that the case might be resolved under a new SEC leadership after Gensler’s departure.

The dispute between Ripple and the SEC began in 2020, when the agency accused Ripple of violating securities laws by selling XRP without registering it as a security. Ripple has consistently denied the allegations, arguing that XRP functions as a digital asset similar to Bitcoin or Ethereum, which the SEC does not classify as securities.

The legal battle escalated in August 2024, when a court ordered Ripple to pay $125 million in penalties. The SEC later appealed the decision, and Ripple’s subsequent request to delay filing its appeal brief was denied.

Ripple’s legal team remains optimistic about the outcome, viewing new SEC leadership as an opportunity for a more constructive approach to regulating digital assets.