- Ripple CEO Brad Garlinghouse has replied to ex-SEC executive Jay clayton on crypto regulation.
- Clayton called for more crypto regulation to be enacted under the current framework.
Ripple CEO Brad Garlinghouse recently spoke on crypto regulation. The CEO was replying to former SEC chairman Jay Clayton. Clayton has asked for more regulation on cryptocurrencies under the current framework. The formers SEC chairman was strict on cryptocurrencies during his tenure as the SEC chairman. While he was in office, Clayton turned down all Bitcoin ETF proposals and during his last days in the office went after Ripple.
Former SEC executive on crypto regulation
The Ripple vs. SEC legal battle has gone on for months now. The regulator filed an action against the company in late 2020 and the matter has been in court since then. More recently, the former SEC chairman addressed the issue of crypto regulation in an editorial article published on the 6th of June. In the article titled “Crypto Needs Regulation, but it Doesn’t Need New Rules,” Clayton referred to digital assets as part of a “digital revolution underway in the financial services industry.”
He further explained that regulators in the US are familiar with crypto usage for financial exercises like payments. As such, he believes that the regulators can tackle the risks associated with cryptocurrencies so that they do not affect their promises.
The former SEC chairman stated:
… If coordinated analysis by national and international authorities reveals a regulatory gap, it should be filled. But we shouldn’t begin by assuming a need to reinvent the regulatory regime.
Clayton cited the “bearer bonds” as an example. He said that several agencies across the US and other agencies abroad brought the market to a close, ensuring that it does not affect the overall bond market. Speaking further, the ex-SEC executive mentioned that the same approach may be employed. He said the approach could be used to address new instruments with identical risks, including the transfer of BTC with an anonymous wallet.
Ripple CEO replies
In a Twitter response, Garlinghouse referred to Clayton’s article as “definitely ironic.” However, he acknowledged the transition in the government stance regarding the crypto space. Garlinghouse said:
My main takeaway from this? Jay Clayton is joining the chorus of voices saying there is & has been a lack of regulatory clarity for crypto and that stifles innovation here in the US (definitely ironic, but better late than never!).
In addition, Garlinghouse talked about how people generally use technology legally and illegally. He argued that US companies that are compliant are the ones facing legal consequences. Furthermore, he cited Clayton’s statement that “innovation is welcome absent some legal reason to oppose it.”
The ongoing battle between the SEC and Ripple has been a topic of discussion in the crypto community. Towards the end of last month, the court denied a motion filed by the SEC to access Ripple’s legal concerns about XRP. The SEC had asked that the court order Ripple Labs to give them access to legal documents on XRP sales. The Commission asked to review the legal records showing whether the sales of SRP are in line with the federal securities law. The judge, Sarah Netburn, mentioned attorney-client privilege as one of the reasons to deny the motion.