- Crypto attorney John Deaton believes a settlement under US $20 million in the SEC vs. Ripple case would significantly favour Ripple.
- This is countering views of an even split and reflecting the crypto community’s positive outlook on such an outcome.
- The SEC, led by Gary Gensler, is facing criticism and legal defeats regarding its regulatory approach to crypto, with yet another loss in court.
Ripple vs SEC Not 50-50
Prominent crypto attorney John Deaton has shared his perspective on the SEC vs. Ripple lawsuit, suggesting that if Ripple were to settle the lawsuit with the United States Securities and Exchange Commission (SEC) for US $20 million (AU $30.71) or less, it would be a considerable victory for Ripple. Contradicting the notion that the lawsuit outcome is evenly split, Deaton believes Ripple holds a 90/10 advantage over the SEC.
The people who’ve argued that the SEC got a 50-50 victory in the Ripple case are wrong. It was more like 90-10 in Ripple’s favour.
John E. DeatonHis comments follow a post by Ripple’s Chief Legal Officer Stuart Alderoty about another legal obstacle the SEC has encountered. The crypto community largely agrees with Deaton, viewing a potential $20 million settlement as favourable for Ripple, especially considering the implications for XRP and the wider regulatory climate for cryptocurrencies.
Is the SEC Fighting a Losing Battle?
The SEC under Gary Gensler’s leadership has suffered a few set-backs to its regulation by enforcement approach to crypto. Some judges have called the SEC’s approach “capricious and arbitrary,” in what is a verbal slap in the face of the regulator.
In a report by the Wall Street Journal, with the telling title “Gary Gensler and the SEC Lose Again,” the WSJ writes that the Fifth Circuit Court of Appeals overturned regulation pushed by SEC Chairman Gary Gensler, which required public companies to disclose their daily stock buybacks and the reasons behind them.
The U.S. Chamber of Commerce sued the SEC over this rule, claiming that the agency failed to properly analyse the costs and benefits of the rule as required by the Administrative Procedure Act. The court agreed with the Chamber and criticised the SEC for not providing sufficient evidence of the rule’s benefits and for being inconsistent in its logic regarding the costs of disclosure compared to its value for investors.
The court has given the SEC 30 days to fix the rule’s deficiencies, including proving that problematic buybacks are actually a serious issue, which the current evidence does not seem to support. This legal setback is part of a series for Gensler, whose approach of introducing a multitude of new regulations has led to multiple legal challenges and defeats for the agency.
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