Brad Garlinghouse: SEC's Use of XRP Report Under Fire

Brad  Garlinghouse: SEC's Use of XRP Report Under Fire
In a recent development, Ripple CEO Brad Garlinghouse has openly criticized the United States Securities and Exchange Commission (SEC) for utilizing Ripple's quarterly XRP Markets Report as evidence against the company in the ongoing lawsuit. The XRP Markets Report was initially introduced by Ripple to enhance transparency within the cryptocurrency industry.


 

Garlinghouse conveyed his dissatisfaction with the SEC's approach, stating that the company had initiated these reports voluntarily to provide updates on its XRP holdings. However, he pointed out that these very reports were being employed against Ripple by the SEC. Despite this setback, Garlinghouse reiterated Ripple's unwavering commitment to transparency. He also hinted at potential modifications to the format of future reports.

Ripple recently released its Q2 2023 XRP Markets Report on July 31. This report diverges from previous editions as it focuses on significant highlights, notably Judge Torres' pivotal summary judgment ruling. This ruling has helped to clarify misconceptions and shed light on Ripple's XRP holdings.

The Q2 2023 report discloses a notable increase in Ripple's XRP holdings, rising from 5,506,585,918 to 5,551,119,094. This upsurge represents an approximate gain of 45 million. Concurrently, the report highlights a decrease of nearly 1 billion in total XRP on ledger escrow. This reduction can be attributed to the escalating demand for XRP within the market.

Notably, Ripple's criticism is not isolated. XRP lawyer John Deaton has also voiced strong disapproval of the SEC's utilization of these reports as evidence against Ripple and its executives in the ongoing lawsuit. Deaton emphasized that Ripple willingly releases these quarterly reports, setting it apart from other companies that not only conceal token sales but also deliberately obfuscate such transactions.


 

Ripple acknowledged the significance of Judge Torres' ruling on July 13 in the case of Securities and Exchange Commission v. Ripple Labs. This ruling established that XRP is not classified as a security. However, Ripple clarified that while all XRP sales don't fall under the security classification, sales conducted under written contracts could be categorized as investment contracts and thus could be subject to security classification.

Moreover, Ripple sought to dispel misconceptions surrounding its partial legal victory. While XRP isn't considered a security in certain contexts, the company clarified that specific circumstances might still lead to such a classification. Additionally, the company highlighted that the ruling offers protection to sophisticated institutions but doesn't extend the same protection to retail buyers. This nuanced stance underscores the complexity of the legal considerations at play.

As Ripple's legal battle continues, these recent developments reflect the intricate dynamics between regulatory authorities and cryptocurrency enterprises in the evolving landscape of digital assets.

Also Read: Haun Ventures CEO: Ripple Case Leaves SEC in 'Current Confusion

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