Ripple’s Chief Legal Officer, Stuart Alderoty, made a bold prediction ahead of the U.S. House of Representatives Committee on Financial Services hearing, which was held on September 27. He believed that SEC Chair Gary Gensler would continue to assert that XRP is a security despite the court’s verdict.
This statement comes amid Gensler’s rigorous enforcement of U.S. investment regulations within the cryptocurrency industry. The SEC has gone against XRP, Binance, Coinbase and more.
The SEC’s actions have not been received favorably by the crypto community, with a notable member of the XRP community recently wishing that Gensler would get marched through the crowd in shame at the upcoming Ripple victory party.
The Ripple Victory
In July 2023, Judge Torres delivered a decision challenging the SEC’s long-standing assertion that XRP constitutes an investment contract when sold on exchanges. Judge Torres argued that this characterization did not align with the nature of XRP transactions and declared XRP not a security.
Following this, XRP experienced a remarkable price surge and many top exchanges started announcing the relisting of the digital asset.
Gensler’s Testimony
Eleanor Terrett, a journalist with Fox Business, shared part of Gensler’s testimony for the House Financial Services hearing scheduled for September 27. She shared a section showing his comments on cryptocurrencies.
In the shared document, Gensler referred to the crypto market as “reminiscent of what we had in the 1920s before the federal securities laws were put in place.”
Stuart Alderoty responded to the post by suggesting that Gensler would testify before Congress and claim the existence of a “crypto investment market,” asserting the tokens themselves are investment deals. He believes the SEC chairman will lie to Congress during the House Financial Services hearing scheduled for September 27.
1/ The SEC Chair will go to Congress tomorrow and lie by stating that there is such a thing as a “crypto asset securities market” and tokens themselves are investment contracts. https://t.co/PxNhZEuDaF
— Stuart Alderoty (@s_alderoty) September 26, 2023
This contention stems from Gary Gensler’s September 2023 statement during a Senate meeting, where he emphasized the prevalence of fraudulent activities and misconduct within the crypto space.
Alderoty, however, underlined a significant part of Judge Torres’s ruling, arguing that XRP, as a digital token, might not fall within the scope of investment deals, transactions, or schemes regulated by the Howey requirements for investment contracts.
Gensler also said that he would not comment on any ongoing legal disputes. The debate around cryptocurrencies has been intensifying, especially in the U.S.
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